CNA Financial

CNA Financial Corporation
Public
Traded as NYSE: CNA
Industry Insurance
Founded 1897 (1897)
Detroit, Michigan, U.S.
1967 (1967) (parent company)
Headquarters CNA Center
Chicago, Illinois, U.S.
Key people
 Thomas F. Motamed, Chairman and CEO
Revenue Increase US$ 9.547 billion (2012)[1]
Decrease US$ 628 million (2012)[1]
Increase US$ 628 million (2012)[1]
Total assets Increase US$ 58.522 billion (2012)[1]
Total equity Increase US$ 12.314 billion (2012)[1]
Number of employees
 7,500 (Dec 2012)[1]
Parent Loews Corporation
Website www.cna.com

CNA Financial Corporation is a financial corporation based in Chicago, Illinois, United States, and noted for its 600-foot (180 m) tall red headquarters building, CNA Center. Its principal subsidiary, Continental Casualty Company (CCC), was founded in 1897.[2] CNA (the parent company) was incorporated in 1967.

CNA itself is 90% owned by a holding company, Loews Corporation.[1] This holding company also has interests in offshore oil and gas drilling rigs, natural gas transmission pipelines, oil and gas exploration, and in hotel operations.

History

Continental Assurance Company of North America was founded in Detroit in 1897.[2] The purpose of the company was to provide accident and health insurance to railroad industry employees. This company then merged with the Metropolitan Accident Company, changed its name to the Continental Casualty Company, and moved to Chicago.

The National Fire Insurance Company was acquired in 1956, and in 1963 the American Casualty Company was acquired. The first letters of each of the original companies were merged to form the acronym CNA. It was then referred to as the Continental National American Group, now it simply goes by CNA.

In 1968, CNA bought the Manhattan Fund from Gerald Tsai for $27 million in stock.[3]

In 1999, CNA sold its personal insurance division to Allstate.[4][5] That personal insurance company is now Encompass Insurance Company, a subsidiary of Allstate.[6]

On February 13, 2003, the company restated its financial data for the past three years, cutting shareholders' equity by $254 million, to comply with federal accounting requirements concerning its life settlement contracts.[7] On March 19, 2003, the company announced a revision to its previously reported fourth quarter 2002 results to reflect an additional $32 million of after-tax impairment losses on equity securities.[8] On May 3, 2005, CNA said it would restate financial results for prior years to correct its accounting for several reinsurance contracts, mainly with a former affiliate, and its equity accounting with this affiliate. For 2004, this would reduce stockholders' equity as of Dec. 31, 2004, by $29 million, or 0.3 percent.[9] On February 16, 2006, CNA restated its annual financial statements from 2001 to 2004 as well as interim statements through the third quarter of 2005 to correct accounting for businesses reported as discontinued operations.[10] On March 8, 2006, the company would make their third results restatements in less than a year, to correct errors in reporting cash flow.[11]

On January 1, 2004, CNA sold its Group Benefits division to The Hartford, based in Hartford, Connecticut.[12] The Hartford merged its new purchase with its own Group Benefits Division. With the sale of this division came the end of CNA's long history as a multi-line insurer.

In 2009 CNA hired Thomas Motamed, who had retired from Chubb Corporation in 2009, as its new Chairman and CEO.[13] From 2009 to 2014, Motamed changed CNA's focus from providing general property and casualty insurance, into a focus on niches such as health care, financial services and property coverage; he cut jobs, eliminating IT staff and less profitable businesses like workers' compensation coverage, and paid Berkshire Hathaway to take over longterm liabilities for asbestos and other environmental claims.[14] Due to these actions CNA had $937.0 million in net income on revenue of $10.11 billion in 2013, its best performance since 2006.[14]

In May 2011, a United States Department of Labor administrative law judge referred the company for criminal investigation after a probe found that the firm had failed to pay life insurance benefits to the families of nine Iraqi translators killed while working for the American government. The Labor investigation reportedly found that the company had withheld documents and information in an effort to avoid making the payments.[15]

In 2012 CNA paid the City of Chicago $13.7 million in tax credits that the company had received since 2006. The tax credits were given based on CNA's promise to retain at least 2,700 employees in Chicago, but the job cuts by CNA had reduced the headcount to ~2100 by the end of 2012.[14]

Main article: CNA Center

References

  1. 1 2 3 4 5 6 7 "CNA Financial, Form 10-K, Annual Report, Filing Date Feb 21, 2013" (PDF). secdatabase.com. Retrieved Mar 27, 2013.
  2. 1 2 "CNA Financial, Form 10-K, Annual Report, Filing Date Feb 22, 2011" (PDF). secdatabase.com. Retrieved Mar 27, 2013.
  3. ↑ Jerry Tsai's Smart Timing, Forbes
  4. ↑ "CNA Financial, Form 8-K, Current Report, Filing Date Jun 10, 1999". secdatabase.com. Retrieved Mar 27, 2013.
  5. ↑ Bloomberg News, Allstate to Buy CNA's Personal Insurance Unit, published in the Los Angeles Times (June 10, 1999). Retrieved on August 18, 2012.
  6. ↑ Company Overview of Encompass Insurance, from Bloomberg Businessweek. Retrieved on August 19, 2012.
  7. ↑ "CNA FINANCIAL POSTS PROFITS, RESTATES FINANCIAL DATA".
  8. ↑ "CNA Financial Announces Revision to 4th Quarter and Year-End 2002 Results".
  9. ↑ "UPDATE 1-CNA posts 1st-qtr profit, to restate some results.".
  10. ↑ "UPDATE 1-CNA Financial posts 4th-qtr loss, to restate".
  11. ↑ "UPDATE 3-Loews, CNA unit to restate for 3rd time in a year". Archived from the original on 2016-02-15.
  12. ↑ "CNA Financial, Form 8-K, Current Report, Filing Date Jan 5, 2004". secdatabase.com. Retrieved Mar 27, 2013.
  13. ↑ Elisabeth Boone for Rough Notes. April 9, 2009 Taking the Helm in a Perfect Storm: Industry veteran Tom Motamed brings experience and vision to CNA
  14. 1 2 3 Steve Daniels for Crain's Chicago Business. March 24, 2014 Why jobs and revenue are going opposite directions at CNA
  15. ↑ Miller, T. Christian, "Insurer Faces Criminal Inquiry In Iraq Case", Los Angeles Times, 24 May 2011, p. 7.
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