John Kellington
CINCINNATI FINANCIALAbout John Kellington
John S. Kellington is Chief Information Officer and Executive Vice President of The Cincinnati Insurance Company, responsible for enterprise technology platforms and related activities; he has served as a corporate executive officer since 2010 and became CIO in February 2020. He is 63 as of February 24, 2025, and has been EVP since 2022, overseeing enterprise technology and cybersecurity reporting to the board’s audit committee alongside the CISO and CRO . Company performance metrics that drive his incentive pay include a 2024 value creation ratio (VCR) of 19.8% and three-year TSR of 36.5% for the period ending December 31, 2024 .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| The Cincinnati Insurance Company | Chief Information Officer | Feb 2020–present | Responsible for enterprise technology platforms and related activities; quarterly cybersecurity reporting to the audit committee and senior executives . |
| The Cincinnati Insurance Company | Executive Vice President | 2022–present | Executive leadership over technology platforms and related activities . |
| Cincinnati Financial Corporation | Executive Officer | 2010–present | Member of senior management team; governance interface across technology risk and reporting . |
Fixed Compensation
Multi-year Summary Compensation (SEC-reported):
| Metric ($) | 2022 | 2023 | 2024 |
|---|---|---|---|
| Salary | 657,662 | 694,161 | 723,961 |
| Stock Awards | 861,273 | 1,054,377 | 789,051 |
| Option Awards | 619,305 | 656,505 | 682,769 |
| Non-Equity Incentive Compensation | 825,777 | 875,324 | 1,820,674 |
| All Other Compensation | 124,229 | 117,272 | 123,218 |
| Total Compensation | 3,088,246 | 3,397,639 | 4,139,673 |
Base Annual Salary levels (Committee-set):
| Year | Base Annual Salary ($) |
|---|---|
| 2022 | 660,622 |
| 2023 | 700,259 |
| 2024 | 728,270 (used in incentive formula) |
Perquisites (selected items) in 2024:
- Aggregate perquisites of $26,060 (including employer-paid health care premiums, umbrella liability policy, company car use, safe driver award, executive health exam, dining room discounts) .
- Matching contributions to 401(k) and Top Hat Savings Plans totaled $95,957 in 2024 .
Performance Compensation
Annual Incentive (2024):
| Component | Detail |
|---|---|
| Tier Target % of Base Salary | 125% (Tier I) |
| Performance Factor | 200% (maximum) |
| Base Annual Salary used | $728,270 |
| Formula | Base Salary × Tier % × Performance Factor |
| 2024 Payout | $1,820,675 (reported as $1,820,674) |
Annual Incentive Performance Metrics (2024):
| Metric | Target/Hurdle | Actual/Outcome | Effect on Award |
|---|---|---|---|
| VCR vs Peer Group (9 companies) | Relative placement determines payout | Exceeded 8 of 9 peers → baseline placement improved to max payout | Drove 200% performance factor |
| Net Written Premium Growth | ≥3% | Achieved ≥3% | Enhanced placement by +2 |
| Combined Ratio | ≤95.0% | Achieved ≤95.0% | Enhanced placement by +2 |
Equity Awards Granted (February 19, 2024):
| Award Type | Count/Terms | Vesting | Valuation/Price |
|---|---|---|---|
| Nonqualified Stock Options | 20,615 options | Vest 1/3 per year over 3 years | Exercise price $112.36; expiration 2/19/2034 |
| Performance-Based RSUs (PSUs) | 6,077 PSUs (target) | Cliff vest after 3-year period; payable March 1, 2027 if hurdles achieved | |
| Service-Vesting RSUs | 1,621 RSUs | Ratably vest in thirds over 3 years | |
| Holiday Stock | 10 shares (broad-based plan) | Immediate grant; not performance-based | Grant-date FMV $150.73 (Nov 15, 2024) |
PSU Performance Framework and Realized Payouts:
| PSU Grant/Period | Target (#) | Hurdle Structure | Actual Payout | Value |
|---|---|---|---|---|
| 2022–2024 PSU cycle | 4,998 | Relative TSR percentiles: Threshold 30%, Target 50%, Max 75%; Payout 30%/100%/200% | 30% at Threshold → 1,500 vested | $215,550 (at $143.70 closing price) |
| 2024 PSU grant | 6,077 target | As above; performance period 2024–2026 | TBD; vests 3/1/2027 if hurdles achieved | N/A |
2024 Exercises/Vesting Activity:
| Name | Options Exercised (#) | Value Realized ($) | Stock Vested (#) | Value Realized ($) |
|---|---|---|---|---|
| John S. Kellington | — | — | 1,465 | 166,072 |
Equity Ownership & Alignment
Beneficial Ownership (as of March 5, 2025):
| Holder | Shares Beneficially Owned | % of Class | Notes |
|---|---|---|---|
| John S. Kellington | 244,717 | 0.16% | Includes 158,306 shares underlying options exercisable within 60 days . |
Outstanding Equity Awards at 2024 Year-End (Kellington):
| Category | Count (#) | Market/Payout Value ($) |
|---|---|---|
| RSUs – not vested (2012–2024 grants) | 444; 930; 1,621 | 63,803; 133,641; 232,938 |
| PSUs – unearned (2022; 2023; 2024 cycles) | 4,998; 5,229; 6,077 | 718,213; 751,407; 873,265 |
| Options – exercisable/unexercisable | Multiple tranches; latest grant 20,615 unexercisable (2024) | Exercise prices span $61.47–$125.57; latest $112.36; expirations 2026–2034 . |
Ownership Policies and Practices:
- Stock ownership guidelines: CEO 5x salary; other NEOs 3.5x salary; all directors and executive officers in compliance .
- Hedging of CINF securities prohibited for directors, officers, associates .
- Pledging permitted with oversight; less than 0.1% of outstanding shares pledged by directors/executives at year-end 2024; 25 of 28 pledge none . No pledged shares disclosed for Kellington; pledged shares footnotes list other individuals, not Kellington .
Employment Terms
- Employment status: At-will; the company does not use employment contracts for executive officers .
- Clawback: Incentive compensation subject to recovery under Policy For The Recovery Of Erroneously Awarded Compensation; applies to annual incentive and stock-based awards .
- Change-in-control: Double-trigger acceleration provisions for incentive and stock-based awards .
Potential Payments Upon Termination (Kellington):
| Scenario | Top Hat Savings Plan ($) | Retirement Plan ($) | SERP ($) | Stock-Based Awards ($) | Annual Incentive ($) |
|---|---|---|---|---|---|
| Retirement | 3,447,455 | — | — | 4,523,902 | 1,820,674 |
| Retirement with Disability | — | — | — | 4,523,902 | 1,820,674 |
| Change in Control | — | — | — | 4,523,902 | 1,820,674 |
Notes:
- Kellington never participated in the pension plan or SERP; acceleration applies to outstanding stock-based awards and annual incentive awards under disability or change-in-control; acceleration does not apply for other termination types unless normal retirement criteria are met (age 65 and 35 years service, which he has not attained) .
Investment Implications
- Pay-for-performance alignment: 2024 annual incentive paid at the maximum 200% based on VCR outperformance versus peers, combined with premium growth and underwriting profitability goals; long-term equity mix includes options, PSUs, and RSUs with clear performance and service-vesting schedules, reinforcing alignment and retention .
- Near-term selling pressure: No options exercised in 2024 and modest stock vesting suggests limited immediate sell pressure; however, 158,306 options are exercisable within 60 days as of the proxy date, and multiple RSU tranches are scheduled to vest over the next two years, which can create periodic liquidity events around vesting/exercise windows .
- Retention and change-in-control economics: Material value in unearned PSUs and unvested RSUs plus double-trigger acceleration and Top Hat balances provide structured retention incentives; absence of employment contracts and pension/SERP reduces guaranteed severance risk while clawback and hedging prohibitions support shareholder-friendly governance .
- Ownership alignment: 0.16% beneficial stake, compliance with 3.5x salary ownership guideline, and no pledged shares disclosed for Kellington collectively indicate strong skin-in-the-game and low alignment risk; company-wide pledging remains minimal and is expected to decline over time .