8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) April 30, 2012

CNA FINANCIAL CORPORATION

(Exact name of registrant as specified in its charter)

Delaware	1-5823	36-6169860
(State or other jurisdiction	(Commission	(IRS Employer
of incorporation)	File Number)	Identification No.)

333 S. Wabash, Chicago, Illinois	60604
(Address of principal executive offices)	(Zip Code)

Registrant's telephone number, including area code (312) 822-5000

NOT APPLICABLE

(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

1

ITEM 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION.

On April 30, 2012, the registrant issued a press release and posted on its website (www.cna.com) a financial supplement providing information on its results of operations for the first quarter 2012. The press release is furnished as Exhibit 99.1 and the financial supplement is furnished as Exhibit 99.2 to this Form 8-K.

The information under Item 2.02 and in Exhibits 99.1 and 99.2 in this Current Report is being furnished and shall not be deemed “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section. The information under Item 2.02 and in Exhibits 99.1 and 99.2 in this Current Report shall not be incorporated by reference into any registration statement or other document pursuant to the Securities Act of 1933, as amended.

ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS.

(d) Exhibits:

See Exhibit Index.

2

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

		CNA Financial Corporation
		(Registrant)
Date:  April 30, 2012	By	/s/ D. Craig Mense
		(Signature)
		D. Craig Mense Executive Vice President and Chief Financial Officer

3

EXHIBIT INDEX

Exhibit No.	Description
99.1	CNA Financial Corporation press release, issued April 30, 2012, providing information on the first quarter 2012 results of operations.
99.2	CNA Financial Corporation financial supplement, posted on its website April 30, 2012, providing supplemental financial information on the first quarter 2012.

4

EX-99.1

FOR IMMEDIATE RELEASE

CONTACT:

MEDIA:	ANALYSTS:
Katrina W. Parker, 312/822-5167	Marie Hotza, 312/822-4278
Sarah J. Pang, 312/822-6394	David C. Adams, 312/822-2183

CNA FINANCIAL ANNOUNCES FIRST QUARTER 2012 RESULTS:

NET OPERATING INCOME OF $226MILLION, NET INCOME OF $250 MILLION,

OPERATING ROE OF 8.1%

BOOK VALUE PER SHARE OF $44.48,

AN INCREASE OF 4% FROM DECEMBER 31, 2011

QUARTERLY DIVIDEND OF $0.15 PER SHARE

CHICAGO, April 30, 2012 --- CNA Financial Corporation (NYSE: CNA) today announced first quarter 2012 results, which included net operating income of $226 million, or $0.84 per share, and net income of $250 million, or $0.93 per share. Property & Casualty Operations combined ratio for the first quarter was 102.0%. Book value per share was $44.48 at March 31, 2012, as compared to $42.66 at December 31, 2011.

CNA Financial also announced declaration of a quarterly dividend of $0.15 per share, payable May 30, 2012 to stockholders of record on May 14, 2012.

	Results for the Three Months Ended March 31 (a)
($ millions)	2012		2011 (b)
Net operating income	$	226	$	213
Net realized investment gains	24		8
Net income from continuing operations	250		221
Net loss from discontinued operations	—		(1		)
Net income	$	250	$	220

___________________

(a) References to net operating income (loss), net realized investment gains (losses), net income (loss) from continuing operations and net income (loss) used in this press release reflect amounts attributable to CNA, unless otherwise noted. Management utilizes the net operating income financial measure to monitor the Company's operations. Please refer to Note N of the Consolidated Financial Statements within CNA's Annual Report on Form 10-K for the year ended December 31, 2011 for further discussion of this measure.

(b) The Company has adjusted its previously reported financial information to reflect a retrospective change in accounting guidance for deferred acquisition costs. Financial information included herein gives effect to this adjustment. For the first quarter of 2011, the impacts of adopting the new accounting standard were a $3 million decrease in Net operating income and Net income, a $0.01 decrease in Earnings per share and a $0.26 decrease in Book value per share.

1

Earnings Per Share Attributable to Common Stockholders
	Results for the Three Months Ended March 31 (a)
	2012		2011
Net operating income	$	0.84	$	0.79
Net realized investment gains	0.09		0.03
Net income from continuing operations	0.93		0.82
Net loss from discontinued operations	—		—
Net income	$	0.93	$	0.82

Net operating income for the first quarter of 2012 increased $13 million as compared with the same period in 2011. Net operating income for our core Property & Casualty Operations increased $13 million, helped by lower catastrophe losses and higher net investment income. For the first quarter of 2012, catastrophe losses were $18 million after-tax as compared to $36 million after-tax for the same period in 2011. Our Property & Casualty Operations produced first quarter combined ratios of 102.0% and 102.1% in 2012 and 2011. Excluding the impacts of catastrophe losses and development, our combined ratio increased to 102.2% from 100.4% for the same comparable periods. The unfavorable year over year comparison was largely due to a significant expense recovery recognized in the earlier period.

“We are pleased to report our first quarter results, which include improved earnings and continued progress as we work to improve the scale and profitability of our core P&C business. We are encouraged by the continuation of favorable rate trends and premium growth across both of our P&C segments,” said Thomas F. Motamed, Chairman and Chief Executive Officer of CNA Financial Corporation.

“In addition, we took an important step to expand our capabilities to underwrite profitable, specialized lines in the global marketplace. As previously announced, we have reached an agreement to acquire Hardy Underwriting Bermuda, a specialized Lloyd's underwriter, at a cost of approximately $227 million, payable in cash. Hardy Underwriting has a long and distinguished history of disciplined underwriting with a respected brand. Hardy's shareholders approved the acquisition on April 26 and we expect the transaction to close in the second quarter, subject to receipt of regulatory approvals.”

Pretax net investment income for the first quarter of 2012 increased $28 million as compared with the same period in 2011. The increase was primarily driven by higher income from limited partnership investments as well as higher fixed maturity securities income.

After-tax net realized investment gains increased $16 million for the first quarter of 2012 as compared with the same period in 2011.

2

Business Operating Highlights

CNA Specialty provides professional and management liability, surety and other property and casualty coverages and services, which include warranty and service contracts. Specialty products are sold both domestically and abroad, through brokers, independent agencies and managing general underwriters.

• Net written premiums increased $26 million, or 4%, for the first quarter of 2012 as compared with the same period in 2011, primarily driven by increased rate. Average rate increased 3% for the first quarter of 2012, as compared to a decrease of 1% for the same period in 2011 for the policies that renewed in each period. Retention of 87% and 86% was achieved in each period.

• Net income increased $5 million and net operating income increased $4 million for the first quarter of 2012 as compared with the same period in 2011. The increase in net operating income was primarily due to increased net investment income, partially offset by lower favorable net prior year development and decreased current accident year underwriting results.

• The combined ratio increased 2.2 points for the first quarter of 2012 as compared with the same period in 2011. The loss ratio increased 2.1 points, primarily due to the impact of lower favorable net prior year development.

• CNA Specialty produced first quarter combined ratios of 97.3% and 95.1% in 2012 and 2011. Excluding the impacts of catastrophe losses and development, our combined ratios were 98.8% and 97.8% for the same comparable periods.

CNA Commercial works with an independent agency distribution system and brokers to market a broad range of property and casualty insurance products and services to small, middle-market and large businesses and organizations domestically and abroad.

• Net written premiums increased $15 million, or 2% (6% excluding the impact of a subsidiary sold in the fourth quarter of 2011), for the first quarter of 2012 as compared with the same period in 2011. This increase was primarily driven by new business and increased rate. Average rate increased 5% for the first quarter of 2012, as compared to an increase of 1% for the first quarter of 2011 for the policies that renewed in each period. Retention of 78% and 79% was achieved in each period.

• Net income increased $6 million and net operating income increased $9 million for the first quarter of 2012 as compared with the same period in 2011. The increase in net operating income was primarily due to lower catastrophe losses and increased favorable net prior year development, partially offset by increased expenses.

• The combined ratio improved 1.8 points for the first quarter of 2012 as compared with the same period in 2011. The loss ratio improved 4.6 points, primarily due to the impacts of lower catastrophe losses and increased favorable net prior year development. The expense ratio increased 2.2 points, primarily due to the favorable impact in 2011 of recoveries on insurance receivables written off in prior years.

• CNA Commercial produced first quarter combined ratios of 106.2% and 108.0% in 2012 and 2011. Excluding the impacts of catastrophe losses and development, our combined ratios were 105.4% and 102.6% for the same comparable periods.

Life & Group Non-Core primarily includes the results of the life and group lines of business that are in run-off. Net earned premiums relate primarily to the individual and group long term care businesses.

• Net loss decreased $10 million for the first quarter of 2012 as compared with the same period in 2011. This decrease was primarily due to improved net realized investment results.

Corporate & Other Non-Core primarily includes certain corporate expenses, including interest on corporate debt, and the results of certain property and casualty business in run-off, including CNA Re and asbestos and environmental pollution (A&EP).

• Net loss decreased $8 million for the first quarter of 2012 as compared with the same period in 2011, primarily due to improved net realized investment results. Net operating income in 2012 was helped by lower interest expense, as a result of the issuance of debt on more favorable terms in the first quarter of 2011.

3

Segment Results for the Three Months Ended March 31, 2012
($ millions)	CNA Specialty		CNA Commercial		Total P&C Operations		Life & Group Non-Core			Corporate & Other Non-Core			Total
Net operating income (loss)	$	132	$	139	$	271	$	(19	)	$	(26	)	$	226
Net realized investment gains	6		7		13		8			3			24
Net income (loss) from continuing operations	$	138	$	146	$	284	$	(11	)	$	(23	)	$	250

Segment Results for the Three Months Ended March 31, 2011
($ millions)	CNA Specialty		CNA Commercial		Total P&C Operations		Life & Group Non-Core			Corporate & Other Non-Core			Total
Net operating income (loss)	$	128	$	130	$	258	$	(18	)	$	(27	)	$	213
Net realized investment gains (losses)	5		10		15		(3		)	(4		)	8
Net income (loss) from continuing operations	$	133	$	140	$	273	$	(21	)	$	(31	)	$	221

Property & Casualty Operations Gross Written Premiums
	Three Months Ended March 31
($ millions)	2012		2011
CNA Specialty	$	1,273	$	1,130
CNA Commercial	887		893
Total P&C Operations	$	2,160	$	2,023

Property & Casualty Operations Net Written Premiums
	Three Months Ended March 31
($ millions)	2012		2011
CNA Specialty	$	765	$	739
CNA Commercial	843		828
Total P&C Operations	$	1,608	$	1,567

4

Property & Casualty Calendar Year Loss Ratios
	Three Months Ended March 31
	2012		2011
CNA Specialty	66.3	%	64.2	%
CNA Commercial	70.7	%	75.3	%
Total P&C Operations	68.6	%	70.3	%

Property & Casualty Calendar Year Combined Ratios
	Three Months Ended March 31
	2012		2011
CNA Specialty	97.3	%	95.1	%
CNA Commercial	106.2	%	108.0	%
Total P&C Operations	102.0	%	102.1	%

CNA Specialty Effect of Catastrophe Impacts and Development-Related Items
	Three Months Ended March 31
	2012		2011
Combined ratio excluding the effect of catastrophe impacts and development-related items	98.8	%	97.8	%
Effect of catastrophe impacts	0.2		0.3
Effect of development-related items	(1.7	)	(3.0	)
Combined ratio	97.3	%	95.1	%

CNA Commercial Effect of Catastrophe Impacts and Development-Related Items
	Three Months Ended March 31
	2012		2011
Combined ratio excluding the effect of catastrophe impacts and development-related items	105.4	%	102.6	%
Effect of catastrophe impacts	3.3		6.6
Effect of development-related items	(2.5	)	(1.2	)
Combined ratio	106.2	%	108.0	%

Property & Casualty Operations Effect of Catastrophe Impacts and Development-Related Items
	Three Months Ended March 31
	2012		2011
Combined ratio excluding the effect of catastrophe impacts and development-related items	102.2	%	100.4	%
Effect of catastrophe impacts	1.9		3.7
Effect of development-related items	(2.1	)	(2.0	)
Combined ratio	102.0	%	102.1	%

5

About the Company

Serving businesses and professionals since 1897, CNA is the country's seventh largest commercial insurance writer and the 13^th largest property and casualty company. CNA's insurance products include standard commercial lines, specialty lines, surety, marine and other property and casualty coverages. CNA's services include risk management, information services, underwriting, risk control and claims administration.  For more information, please visit CNA at www.cna.com. CNA is a registered trademark of CNA Financial Corporation.

Conference Call and Webcast Information:

A conference call for investors and the professional investment community will be held at 10:00 a.m. (ET) today. On the conference call will be Thomas F. Motamed, Chairman and Chief Executive Officer of CNA Financial Corporation, and other members of senior management. Participants can access the call by dialing (888) 352-6793, or for international callers, (719) 457-2707. The call will also be broadcast live on the internet at http://investor.cna.com or you may go to the investor relations pages of the CNA website (www.cna.com) for further details.

The call is available to the media, but questions will be restricted to investors and the professional investment community. A taped replay of the call will be available through May 7, 2012 by dialing (888) 203-1112, or for international callers, (719) 457-0820. The replay passcode is 3044015. The replay will also be available on CNA's website. Financial supplement information related to the results is available on the investor relations pages of the CNA website or by contacting David Adams at (312) 822-2183.

Financial Measures

In evaluating the results of CNA Specialty and CNA Commercial, management utilizes the combined ratio, the loss ratio, the expense ratio and the dividend ratio. These ratios are calculated using financial results prepared in accordance with accounting principles generally accepted in the United States of America (GAAP). The loss ratio is the percentage of net incurred claim and claim adjustment expenses to net earned premiums. The expense ratio is the percentage of insurance underwriting and acquisition expenses, including the amortization of deferred acquisition costs, to net earned premiums. The dividend ratio is the ratio of policyholders' dividends incurred to net earned premiums. The combined ratio is the sum of the loss, expense and dividend ratios.

This press release may also reference or contain financial measures that are not in accordance with GAAP. For reconciliations of non-GAAP measures to the most comparable GAAP measures, please refer herein and/or to CNA's most recent 10-K on file with the Securities and Exchange Commission, as well as the financial supplement, available at www.cna.com.

Forward-Looking Statement

This press release may include statements which relate to anticipated future events (forward-looking statements) rather than actual present conditions or historical events. These statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and generally include words such as “believes”, “expects”, “intends”, “anticipates”, “estimates” and similar expressions. Forward-looking statements, by their nature, are subject to a variety of inherent risks and uncertainties that could cause actual results to differ materially from the results projected. Many of these risks and uncertainties cannot be controlled by CNA. For a detailed description of these risks and uncertainties affecting CNA, please refer to CNA's most recent 10-K on file with the Securities and Exchange Commission available at www.cna.com.

Any forward-looking statements made in this press release are made by CNA as of the date of this press release. Further, CNA does not have any obligation to update or revise any forward-looking statement contained in this press release, even if CNA's expectations or any related events, conditions or circumstances change.

# # #

6

EX-99.2

CNA Financial Corporation

Supplemental Financial Information

March 31, 2012

This report is for informational purposes only and includes consolidated financial statements and financial exhibits that are unaudited. This report should be read in conjunction with documents filed with the U.S. Securities and Exchange Commission, including the most recent Annual Report on Form 10-K.

CNA Financial Corporation

Table of Contents

March 31, 2012

	Page
Definitions and Presentation	i
Statements of Operations	1
Components of Income (Loss) Attributable to CNA Common Stockholders, Per Share Data and Return on Equity	2
Selected Balance Sheets Data and Statements of Cash Flows Data	3
Claim & Claim Adjustment Expense Reserve Rollforward	4
Investment Summary - Consolidated	5
Investment Summary - Property & Casualty and Corporate & Other Non-Core	6
Investment Summary - Life & Group Non-Core	7
Investments - Fixed Maturity Securities by Credit Rating	8
Investments - European Exposure - Fair Value by Country of Risk	9
Investments - European Exposure - Credit Rating by Country of Risk	10
Property & Casualty Results of Operations	11
Life & Group Non-Core and Corporate & Other Non-Core Segments Results of Operations	12
Components of Pretax Net Investment Income	13
Statutory Data - Preliminary	14
Property & Casualty Operations Loss & LAE Ratio Analysis	15
Net Carried Life & Group Non-Core Policyholder Reserves	16

CNA Financial Corporation

Definitions and Presentation

• Collectively, CNA Financial Corporation (CNAF) and its controlled subsidiaries are referred to as CNA or the Company.

• P&C Operations includes CNA Specialty and CNA Commercial.

• Life & Group Non-Core segment primarily includes the results of the life and group lines of business that are in run-off.

• Corporate & Other Non-Core segment primarily includes certain corporate expenses including interest on corporate debt and the results of certain property and casualty business in run-off, including CNA Re and asbestos and environmental pollution (A&EP). Intersegment eliminations are also included in this segment.

• Management utilizes the net operating income financial measure to monitor the Company’s operations. Please refer to Note N to the Consolidated Financial Statements within the 2011 Form 10-K for further discussion of this measure.

• In evaluating the results of CNA Specialty and CNA Commercial, management utilizes the combined ratio, the loss ratio, the expense ratio and the dividend ratio. These ratios are calculated using financial results prepared in accordance with accounting principles generally accepted in the United States of America. The loss ratio is the percentage of net incurred claim and claim adjustment expenses to net earned premiums. The expense ratio is the percentage of insurance underwriting and acquisition expenses, including the amortization of deferred acquisition costs, to net earned premiums. The dividend ratio is the ratio of policyholders' dividends incurred to net earned premiums. The combined ratio is the sum of the loss, expense and dividend ratios. The statutory expense ratio reported on page 14 is the percentage of acquisition and underwriting expenses to net written premiums in accordance with statutory accounting practices.

• Limited partnerships are a relatively small portion of CNA's overall investment portfolio. The majority of our limited partnership investments employ hedge fund strategies that generate returns through investing in securities that are marketable while engaging in various management techniques primarily in public fixed income and equity markets. While the Company generally does not invest in highly leveraged partnerships, there are risks which may result in losses due to short-selling, derivatives or other speculative investment practices. The use of leverage increases volatility generated by the underlying investment strategies.

• Certain immaterial differences are due to rounding.

• N/M = Not Meaningful

• FY = Full Year

Accounting for Costs Associated with Acquiring or Renewing Insurance Contracts

The Company has adjusted its previously reported financial information to reflect a retrospective change in accounting guidance for deferred acquisition costs. Financial information included herein gives effect to this adjustment. Total CNA stockholders' equity at December 31, 2011 was reduced by $69 million and Book value per common share decreased $0.26. For the three months ended March 31, 2011, the impacts of adopting the new accounting standard were a $0.01 decrease in earnings per share, and a 0.1% decrease in Net operating income (loss) from continuing operations attributable to CNA return on equity.

i

CNA FINANCIAL CORPORATION

Financial Supplement

Statements of Operations

THREE MONTHS ENDED MARCH 31							Fav / (Unfav)
(In millions)	2012			2011			% Change
STATEMENTS OF OPERATIONS
Revenues:
Net earned premiums	$	1,649		$	1,615		2		%
Net investment income	648			620			5
Net realized investment gains (losses), net of participating policyholders' interests:
Other-than-temporary impairment (OTTI) losses	(15		)	(20		)	25
Portion of OTTI recognized in Other comprehensive income (loss)	(12		)	(21		)	43
Net OTTI losses recognized in earnings	(27		)	(41		)	34
Other net realized investment gains (losses)	63			54			17
Net realized investment gains (losses), net of participating policyholders' interests	36			13			177
Other revenues	68			67			1
Total revenues	2,401			2,315			4
Claims, Benefits and Expenses:
Insurance claims and policyholders' benefits	1,381			1,364			(1	)
Amortization of deferred acquisition costs	295			297			1
Other operating expenses	319			277			(15	)
Interest	42			46			9
Total claims, benefits and expenses	2,037			1,984			(3	)
Income (loss) from continuing operations before income tax	364			331			10
Income tax (expense) benefit	(114		)	(101		)	(13	)
Income (loss) from continuing operations, net of tax	250			230			9
Income (loss) from discontinued operations, net of tax	—			(1		)	N/M
Net income (loss)	250			229			9
Net (income) loss attributable to noncontrolling interests	—			(9		)	N/M
Net income (loss) attributable to CNA	$	250		$	220		14		%

1

CNA FINANCIAL CORPORATION

Financial Supplement

Components of Income (Loss) Attributable to CNA Common Stockholders, Per Share Data and Return on Equity

THREE MONTHS ENDED MARCH 31
(In millions, except per share data)	2012			2011
COMPONENTS OF INCOME (LOSS) ATTRIBUTABLE TO CNA COMMON STOCKHOLDERS
Net operating income (loss) from continuing operations attributable to CNA common stockholders	$	226		$	213
Net realized investment gains (losses) attributable to CNA common stockholders	24			8
Income (loss) from continuing operations attributable to CNA common stockholders	250			221
Income (loss) from discontinued operations attributable to CNA common stockholders	—			(1		)
Income (loss) attributable to CNA common stockholders	$	250		$	220
BASIC AND DILUTED EARNINGS (LOSS) PER COMMON SHARE
Net operating income (loss) from continuing operations attributable to CNA common stockholders	$	0.84		$	0.79
Net realized investment gains (losses) attributable to CNA common stockholders	0.09			0.03
Income (loss) from continuing operations attributable to CNA common stockholders	0.93			0.82
Income (loss) from discontinued operations attributable to CNA common stockholders	—			—
Basic and diluted earnings (loss) per share attributable to CNA common stockholders	$	0.93		$	0.82
WEIGHTED AVERAGE OUTSTANDING COMMON STOCK AND COMMON STOCK EQUIVALENTS
Basic	269.3			269.2
Diluted	269.7			269.5
RETURN ON EQUITY
Net income (loss) attributable to CNA (1)	8.5		%	8.0			%
Net operating income (loss) from continuing operations attributable to CNA (2)	8.1			8.0

(1) Annualized net income (loss) attributable to CNA divided by the average CNA stockholders' equity including accumulated other comprehensive income/loss (AOCI) for the period. Average equity including AOCI is calculated using a simple average of the beginning and ending balances for the period.

(2) Annualized net operating income (loss) from continuing operations attributable to CNA divided by the average CNA stockholders' equity excluding AOCI for the period. Average equity excluding AOCI is calculated using a simple average of the beginning and ending balances for the period.

2

CNA FINANCIAL CORPORATION

Financial Supplement

Selected Balance Sheets Data and Statements of Cash Flows Data

(In millions, except share data)	March 31, 2012		December 31, 2011
Total assets	$	56,007	$	55,110
Insurance reserves	37,714		37,554
Debt	2,609		2,608
Total liabilities	44,026		43,622
Accumulated other comprehensive income (loss)	764		480
Total CNA stockholders' equity	11,981		11,488
Book value per common share	$	44.48	$	42.66
Book value per common share excluding AOCI	$	41.64	$	40.88
Outstanding shares of common stock (in millions of shares)	269.4		269.3

THREE MONTHS ENDED MARCH 31 (In millions)	2012			2011
Net cash flows provided (used) by operating activities	$	312		$	112
Net cash flows provided (used) by investing activities	(287		)	(74		)
Net cash flows provided (used) by financing activities	(42		)	(36		)
Net cash flows provided (used) by operating, investing and financing activities	$	(17	)	$	2

3

CNA FINANCIAL CORPORATION

Financial Supplement

Claim & Claim Adjustment Expense Reserve Rollforward

THREE MONTHS ENDED MARCH 31, 2012 (In millions)	CNA Specialty			CNA Commercial			P&C Operations			Life & Group Non-Core			Corporate & Other Non-Core			Total Operations
Claim & claim adjustment expense reserves, beginning of period
Gross	$	6,840		$	11,509		$	18,349		$	2,825		$	3,129		$	24,303
Ceded	817			1,119			1,936			546			2,538			5,020
Net	6,023			10,390			16,413			2,279			591			19,283
Net incurred claim & claim adjustment expenses	468			568			1,036			185			7			1,228
Net claim & claim adjustment expense payments	(415		)	(672		)	(1,087		)	(137		)	(32		)	(1,256		)
Foreign currency translation adjustment and other	14			12			26			11			(2		)	35
Claim & claim adjustment expense reserves, end of period
Net	6,090			10,298			16,388			2,338			564			19,290
Ceded	830			1,124			1,954			537			2,422			4,913
Gross	$	6,920		$	11,422		$	18,342		$	2,875		$	2,986		$	24,203

4

CNA FINANCIAL CORPORATION
Financial Supplement
Investment Summary - Consolidated

	March 31, 2012						December 31, 2011
(In millions)	Carrying Value			Net Unrealized Gains (Losses)			Carrying Value		Net Unrealized Gains (Losses)
Fixed maturity securities:
Corporate and other bonds	$	21,288		$	1,952		$	20,884	$	1,792
States, municipalities and political subdivisions:
Tax-exempt	6,127			391			5,731		277
Taxable	4,056			558			4,051		487
Total states, municipalities and political subdivisions	10,183			949			9,782		764
Asset-backed: (1)(2)
Agency RMBS	4,341			119			4,185		130
Prime RMBS	844			(41		)	718		(89		)
Sub-prime RMBS	266			(34		)	330		(34		)
Alt-A RMBS	543			(8		)	542		(18		)
Total RMBS	5,994			36			5,775		(11		)
Agency CMBS	81			2			82		3
Other CMBS	1,248			30			1,272		(14		)
Total CMBS	1,329			32			1,354		(11		)
Other ABS	1,039			17			955		9
Total asset-backed	8,362			85			8,084		(13		)
U.S. Treasury and obligations of government-sponsored enterprises	236			12			493		14
Foreign government	655			21			636		28
Redeemable preferred stock	113			8			58		7
Total fixed maturity securities	40,837			3,027			39,937		2,592
Equities	298			20			304		16
Limited partnership investments	2,400			—			2,245		—
Other invested assets	11			—			12		—
Mortgage loans	281			—			234		—
Short term investments	1,638			—			1,641		—
Total investments	$	45,465		$	3,047		$	44,373	$	2,608
Net receivable/(payable)	$	(175	)	$	—		$	45	$	—

(1) Agency RMBS and CMBS include securities issued or guaranteed, or collateralized by assets or securities issued or guaranteed, by U.S. government agencies or government-sponsored enterprises.

(2) The exposure to sub-prime residential mortgage (sub-prime) collateral and Alternative A residential mortgages that have lower than normal standards of loan documentation (Alt-A) collateral is measured by the original deal structure.

RMBS - Residential mortgage-backed securities

CMBS - Commercial mortgage-backed securities

Other ABS - Other asset-backed securities

5

CNA FINANCIAL CORPORATION

Financial Supplement

Investment Summary - Property & Casualty and Corporate & Other Non-Core

	March 31, 2012						December 31, 2011
(In millions)	Carrying Value			Net Unrealized Gains (Losses)			Carrying Value		Net Unrealized Gains (Losses)
Fixed maturity securities:
Corporate and other bonds	$	13,591		$	792		$	13,190	$	620
States, municipalities and political subdivisions:
Tax-exempt	2,289			122			2,204		116
Taxable	2,443			286			2,445		236
Total states, municipalities and political subdivisions	4,732			408			4,649		352
Asset-backed:
Agency RMBS	4,093			112			3,981		122
Prime RMBS	766			(39		)	635		(78		)
Sub-prime RMBS	252			(33		)	316		(32		)
Alt-A RMBS	484			(6		)	483		(15		)
Total RMBS	5,595			34			5,415		(3		)
Agency CMBS	81			2			82		3
Other CMBS	1,059			19			1,087		(21		)
Total CMBS	1,140			21			1,169		(18		)
Other ABS	1,001			14			913		6
Total asset-backed	7,736			69			7,497		(15		)
U.S. Treasury and obligations of government-sponsored enterprises	213			4			469		5
Foreign government	650			20			631		27
Redeemable preferred stock	61			1			7		1
Total fixed maturity securities	26,983			1,294			26,443		990
Equities	111			18			105		18
Limited partnership investments	2,400			—			2,245		—
Other invested assets	11			—			12		—
Mortgage loans	261			—			214		—
Short term investments	1,450			—			1,509		—
Total investments	$	31,216		$	1,312		$	30,528	$	1,008
Net receivable/(payable)	$	(136	)	$	—		$	50	$	—

6

CNA FINANCIAL CORPORATION

Financial Supplement

Investment Summary - Life & Group Non-Core

	March 31, 2012						December 31, 2011
(In millions)	Carrying Value			Net Unrealized Gains (Losses)			Carrying Value			Net Unrealized Gains (Losses)
Fixed maturity securities:
Corporate and other bonds	$	7,697		$	1,160		$	7,694		$	1,172
States, municipalities and political subdivisions:
Tax-exempt	3,838			269			3,527			161
Taxable	1,613			272			1,606			251
Total states, municipalities and political subdivisions	5,451			541			5,133			412
Asset-backed:
Agency RMBS	248			7			204			8
Prime RMBS	78			(2		)	83			(11		)
Sub-prime RMBS	14			(1		)	14			(2		)
Alt-A RMBS	59			(2		)	59			(3		)
Total RMBS	399			2			360			(8		)
Agency CMBS	—			—			—			—
Other CMBS	189			11			185			7
Total CMBS	189			11			185			7
Other ABS	38			3			42			3
Total asset-backed	626			16			587			2
U.S. Treasury and obligations of government-sponsored enterprises	23			8			24			9
Foreign government	5			1			5			1
Redeemable preferred stock	52			7			51			6
Total fixed maturity securities	13,854			1,733			13,494			1,602
Equities	187			2			199			(2		)
Limited partnership investments	—			—			—			—
Other invested assets	—			—			—			—
Mortgage loans	20			—			20			—
Short term investments	188			—			132			—
Total investments	$	14,249		$	1,735		$	13,845		$	1,600
Net receivable/(payable)	$	(39	)	$	—		$	(5	)	$	—

7

CNA FINANCIAL CORPORATION
Financial Supplement
Investments - Fixed Maturity Securities by Credit Rating
March 31, 2012

	U.S. Government, Government agencies and Government-sponsored enterprises					AAA						AA						A					BBB						Non-investment grade						Total
(In millions)	Fair Value			Net Unrealized Gains (Losses)		Fair Value			Net Unrealized Gains (Losses)			Fair Value			Net Unrealized Gains (Losses)			Fair Value			Net Unrealized Gains (Losses)		Fair Value			Net Unrealized Gains (Losses)			Fair Value			Net Unrealized Gains (Losses)			Fair Value			Net Unrealized Gains (Losses)
Corporate and other bonds	$	—		$	—	$	290		$	15		$	1,205		$	99		$	7,192		$	775	$	10,593		$	939		$	2,008		$	124		$	21,288		$	1,952
States, municipalities and political subdivisions:
Tax-exempt	—			—		1,063			80			3,711			248			1,156			57		197			6			—			—			6,127			391
Taxable	—			—		613			76			2,669			364			774			118		—			—			—			—			4,056			558
Total states, municipalities and political subdivisions	—			—		1,676			156			6,380			612			1,930			175		197			6			—			—			10,183			949
Asset-backed:
Agency RMBS	4,341			119		—			—			—			—			—			—		—			—			—			—			4,341			119
Prime RMBS	—			—		51			—			84			(2		)	39			—		101			(10		)	569			(29		)	844			(41		)
Sub-prime RMBS	—			—		48			(3		)	62			(8		)	33			—		19			(3		)	104			(20		)	266			(34		)
Alt-A RMBS	—			—		137			—			32			—			138			—		67			(1		)	169			(7		)	543			(8		)
Total RMBS	4,341			119		236			(3		)	178			(10		)	210			—		187			(14		)	842			(56		)	5,994			36
Agency CMBS	81			2		—			—			—			—			—			—		—			—			—			—			81			2
Other CMBS	—			—		403			21			163			8			259			11		170			5			253			(15		)	1,248			30
Total CMBS	81			2		403			21			163			8			259			11		170			5			253			(15		)	1,329			32
Other ABS	—			—		504			13			318			3			181			1		35			—			1			—			1,039			17
Total asset-backed	4,422			121		1,143			31			659			1			650			12		392			(9		)	1,096			(71		)	8,362			85
U.S. Treasury and obligations of government-sponsored enterprises	236			12		—			—			—			—			—			—		—			—			—			—			236			12
Foreign government	—			—		394			12			156			5			105			4		—			—			—			—			655			21
Redeemable preferred stock	—			—		—			—			—			—			—			—		110			8			3			—			113			8
Total fixed maturity securities	$	4,658		$	133	$	3,503		$	214		$	8,400		$	717		$	9,877		$	966	$	11,292		$	944		$	3,107		$	53		$	40,837		$	3,027
Percentage of total fixed maturity securities	11		%			8		%				21		%				24		%			28		%				8		%				100		%

(1) The ratings presented are based on a ratings methodology that takes into account ratings from two major providers, Standard & Poor's and Moody's Investors Services, Inc., in that order of preference. If a security is not rated by these providers, an internal rating is formulated. For securities with credit support from third party guarantees, the rating reflects the greater of the underlying rating of the issuer or the insured rating.

8

CNA FINANCIAL CORPORATION

Financial Supplement

Investments - European Exposure

Fair Value by Country of Risk*

March 31, 2012

	Corporate				Sovereign		Total
(In millions)	Financial Sector		Other Sectors
European exposure:
United Kingdom	$	705	$	735	$	99	$	1,539
France	230		212		39		481
Netherlands	234		149		33		416
Germany	107		283		—		390
Sweden	155		36		—		191
Spain	32		154		1		187
Belgium	6		171		—		177
Italy	13		135		7		155
Switzerland	80		38		2		120
Luxembourg	—		94		—		94
Norway	2		36		—		38
Russian Federation	—		35		—		35
Greece	—		32		—		32
Finland	—		24		5		29
Austria	4		4		7		15
Ireland	5		—		—		5
Czech Republic	—		4		—		4
Total fair value	$	1,573	$	2,142	$	193	$	3,908
Total amortized cost	$	1,540	$	1,932	$	191	$	3,663

* Country of risk is derived from the issuing entity's management location, country of primary listing, revenue and reporting currency.

9

CNA FINANCIAL CORPORATION

Financial Supplement

Investments - European Exposure

Credit Rating by Country of Risk*

March 31, 2012

(In millions)	AAA		AA		A		BBB		Non-investment grade		Total
United Kingdom	$	135	$	53	$	821	$	489	$	41	$	1,539
France	62		25		180		196		18		481
Netherlands	69		73		147		82		45		416
Germany	78		3		235		61		13		390
Sweden	—		113		46		32		—		191
Spain	—		—		66		109		12		187
Belgium	—		—		84		93		—		177
Italy	—		9		6		137		3		155
Switzerland	2		31		56		24		7		120
Luxembourg	—		—		5		75		14		94
Norway	2		2		—		29		5		38
Russian Federation	—		—		—		28		7		35
Greece	—		—		32		—		—		32
Finland	5		—		—		24		—		29
Austria	—		11		4		—		—		15
Ireland	—		—		—		5		—		5
Czech Republic	—		—		4		—		—		4
Total fair value	$	353	$	320	$	1,686	$	1,384	$	165	$	3,908
Total amortized cost	$	347	$	297	$	1,560	$	1,305	$	154	$	3,663

* Country of risk is derived from the issuing entity's management location, country of primary listing, revenue and reporting currency.

10

CNA FINANCIAL CORPORATION

Financial Supplement

Property & Casualty Results of Operations

	CNA Specialty											CNA Commercial											P&C Operations
THREE MONTHS ENDED MARCH 31 (In millions)	2012				2011				Fav / (Unfav) % Change			2012				2011				Fav / (Unfav) % Change			2012				2011				Fav / (Unfav) % Change
Gross written premiums	$	1,273			$	1,130			13		%	$	887			$	893			(1	)	%	$	2,160			$	2,023			7		%
Net written premiums (1)	765				739				4			843				828				2			1,608				1,567				3
Operating revenues:
Net earned premiums	706				669				6			803				802				—			1,509				1,471				3
Net investment income	175				160				9			265				261				2			440				421				5
Other revenues	56				54				4			9				14				(36	)		65				68				(4	)
Total operating revenues	937				883				6			1,077				1,077				—			2,014				1,960				3
Claims, Benefits and Expenses:
Net incurred claims and benefits	468				430				(9	)		567				603				6			1,035				1,033				—
Policyholders' dividends	(2		)		—				N/M			3				—				N/M			1				—				N/M
Amortization of deferred acquisition costs	148				143				(3	)		139				148				6			287				291				1
Other insurance related expenses	72				64				(13	)		144				115				(25	)		216				179				(21	)
Other expenses	50				40				(25	)		7				16				56			57				56				(2	)
Total claims, benefits and expenses	736				677				(9	)		860				882				2			1,596				1,559				(2	)
Operating income (loss) from continuing operations before income tax	201				206				(2	)		217				195				11			418				401				4
Income tax (expense) benefit on operating income (loss)	(69		)		(70		)		1			(78		)		(65		)		(20	)		(147		)		(135		)		(9	)
Net operating (income) loss, after-tax, attributable to noncontrolling interests	—				(8		)		N/M			—				—				N/M			—				(8		)		N/M
Net operating income (loss) from continuing operations attributable to CNA	132				128				3			139				130				7			271				258				5
Net realized investment gains (losses), net of participating policyholders' interests	8				8				—			11				17				(35	)		19				25				(24	)
Income tax (expense) benefit on net realized investment gains (losses)	(2		)		(3		)		33			(4		)		(6		)		33			(6		)		(9		)		33
Net realized investment (gains) losses, after-tax, attributable to noncontrolling interests	—				—				N/M			—				(1		)		N/M			—				(1		)		N/M
Net realized investment gains (losses) attributable to CNA	6				5				20			7				10				(30	)		13				15				(13	)
Net income (loss) from continuing operations attributable to CNA	$	138			$	133			4		%	$	146			$	140			4		%	$	284			$	273			4		%
FINANCIAL RATIOS
Loss & LAE	66.3			%	64.2			%				70.7			%	75.3			%				68.6			%	70.3			%
Acquisition expense	19.6				19.4							18.3				15.9							18.9				17.5
Underwriting expense	11.7				11.4							16.8				17.0							14.4				14.4
Expense	31.3				30.8							35.1				32.9							33.3				31.9
Dividend	(0.3		)		0.1							0.4				(0.2		)					0.1				(0.1		)
Combined ratio	97.3			%	95.1			%				106.2			%	108.0			%				102.0			%	102.1			%
RATIO IMPACTS
Impact of catastrophes
Pretax net accident year catastrophe losses incurred	$	2			$	2						$	26			$	53						$	28			$	55
Impact on loss & LAE ratio	0.2			%	0.3			%				3.3			%	6.6			%				1.9			%	3.7			%
Impact of development & other
Pretax net prior year development: (favorable) / unfavorable
Prior year loss & ALAE reserve development	$	(6	)		$	(15	)					$	(14	)		$	(7	)					$	(20	)		$	(22	)
Prior year premium development	(9		)		(7		)					(17		)		(8		)					(26		)		(15		)
Other (2)	—				—							6				3							6				3
Total development & other	$	(15	)		$	(22	)					$	(25	)		$	(12	)					$	(40	)		$	(34	)
Impact of development & other on loss & LAE ratio	(1.7		)	%	(3.0		)	%				(2.5		)	%	(1.2		)	%				(2.1		)	%	(2.0		)	%

(1) Net written premiums for CNA Commercial and P&C Operations increased 6% and 5% excluding the impact of First Insurance Company of Hawaii (FICOH). The Company sold its 50% ownership interest in FICOH in the fourth quarter of 2011.

(2) Other includes the impacts of interest accretion and change in allowance for uncollectible reinsurance and deductible amounts.

11

CNA FINANCIAL CORPORATION

Financial Supplement

Life & Group Non-Core and Corporate & Other Non-Core Segments Results of Operations

	P&C Operations						Life & Group Non-Core									Corporate & Other Non-Core									Total Operations
THREE MONTHS ENDED MARCH 31 (In millions)	2012			2011			2012			2011			Fav / (Unfav) % Change			2012			2011			Fav / (Unfav) % Change			2012			2011			Fav / (Unfav) % Change
Operating revenue:
Net earned premiums	$	1,509		$	1,471		$	141		$	144		(2	)	%	$	(1	)	$	—		N/M		%	$	1,649		$	1,615		2		%
Net investment income	440			421			198			188			5			10			11			(9	)		648			620			5
Other revenues	65			68			(2		)	(2		)	—			5			1			N/M			68			67			1
Total operating revenues	2,014			1,960			337			330			2			14			12			17			2,365			2,302			3
Claims, Benefits and Expenses:
Net incurred claims and benefits	1,035			1,033			336			323			(4	)		7			7			—			1,378			1,363			(1	)
Policyholders' dividends	1			—			2			1			(100	)		—			—			N/M			3			1			N/M
Amortization of deferred acquisition costs	287			291			8			6			(33	)		—			—			N/M			295			297			1
Other insurance related expenses	216			179			35			38			8			(1		)	—			N/M			250			217			(15	)
Other expenses	57			56			6			6			—			48			44			(9	)		111			106			(5	)
Total claims, benefits and expenses	1,596			1,559			387			374			(3	)		54			51			(6	)		2,037			1,984			(3	)
Operating income (loss) from continuing operations before income tax	418			401			(50		)	(44		)	(14	)		(40		)	(39		)	(3	)		328			318			3
Income tax (expense) benefit on operating income (loss)	(147		)	(135		)	31			26			19			14			12			17			(102		)	(97		)	(5	)
Net operating (income) loss, after-tax, attributable to noncontrolling interests	—			(8		)	—			—			N/M			—			—			N/M			—			(8		)	N/M
Net operating income (loss) from continuing operations attributable to CNA	271			258			(19		)	(18		)	(6	)		(26		)	(27		)	4			226			213			6
Net realized investment gains (losses), net of participating policyholders' interests	19			25			13			(4		)	N/M			4			(8		)	150			36			13			177
Income tax (expense) benefit on net realized investment gains (losses)	(6		)	(9		)	(5		)	1			N/M			(1		)	4			(125	)		(12		)	(4		)	N/M
Net realized investment (gains) losses, after-tax, attributable to noncontrolling interests	—			(1		)	—			—			N/M			—			—			N/M			—			(1		)	N/M
Net realized investment gains (losses) attributable to CNA	13			15			8			(3		)	N/M			3			(4		)	175			24			8			N/M
Net income (loss) from continuing operations attributable to CNA	$	284		$	273		$	(11	)	$	(21	)	48		%	$	(23	)	$	(31	)	26		%	$	250		$	221		13		%

12

CNA FINANCIAL CORPORATION

Financial Supplement

Components of Pretax Net Investment Income

(In millions)

	CNA Specialty
	1Q11		2Q11		3Q11			4Q11		2011		1Q12
Income (loss) from limited partnerships	$	38	$	4	$	(32	)	$	5	$	15	$	46
Income (loss) from trading portfolio	1		1		—			1		3		3
Other investment income	121		121		117			123		482		126
Net investment income	$	160	$	126	$	85		$	129	$	500	$	175
	CNA Commercial
	1Q11		2Q11		3Q11			4Q11		2011		1Q12
Income (loss) from limited partnerships	$	73	$	6	$	(59	)	$	11	$	31	$	81
Income (loss) from trading portfolio	2		2		(1		)	2		5		4
Other investment income	186		185		175			181		727		180
Net investment income	$	261	$	193	$	115		$	194	$	763	$	265
	P&C Operations
	1Q11		2Q11		3Q11			4Q11		2011		1Q12
Income (loss) from limited partnerships	$	111	$	10	$	(91	)	$	16	$	46	$	127
Income (loss) from trading portfolio	3		3		(1		)	3		8		7
Other investment income	307		306		292			304		1,209		306
Net investment income	$	421	$	319	$	200		$	323	$	1,263	$	440
	Life & Group Non-Core
	1Q11		2Q11		3Q11			4Q11		2011		1Q12
Income (loss) from limited partnerships	$	—	$	—	$	—		$	—	$	—	$	—
Income (loss) from trading portfolio	—		—		—			—		—		—
Other investment income	188		189		190			192		759		198
Net investment income	$	188	$	189	$	190		$	192	$	759	$	198
	Corporate & Other Non-Core
	1Q11		2Q11		3Q11			4Q11		2011		1Q12
Income (loss) from limited partnerships	$	3	$	1	$	(2	)	$	—	$	2	$	3
Income (loss) from trading portfolio	—		—		—			1		1		—
Other investment income	8		8		6			7		29		7
Net investment income	$	11	$	9	$	4		$	8	$	32	$	10
	Total Operations
	1Q11		2Q11		3Q11			4Q11		2011		1Q12
Income (loss) from limited partnerships	$	114	$	11	$	(93	)	$	16	$	48	$	130
Income (loss) from trading portfolio	3		3		(1		)	4		9		7
Other investment income	503		503		488			503		1,997		511
Net investment income	$	620	$	517	$	394		$	523	$	2,054	$	648

13

CNA FINANCIAL CORPORATION

Financial Supplement

Statutory Data - Preliminary

THREE MONTHS ENDED MARCH 31
Income Statements	(Preliminary) 2012								Fav / (Unfav) % Change
(In millions)					2011
Combined Continental Casualty Companies
Gross written premiums	$	2,110			$	1,952			8		%
Net written premiums	1,563				1,510				4
Net earned premiums	1,306				1,246				5
Claim and claim adjustment expenses	1,146				1,109				(3	)
Acquisition expenses	270				256				(5	)
Underwriting expenses	211				194				(9	)
Policyholders' dividends	—				3				N/M
Underwriting income (loss)	(321		)		(316		)		(2	)
Net investment income	428				425				1
Other income (loss)	6				22				(73	)
Income tax (expense) benefit	(14		)		(9		)		(56	)
Net realized gains (losses)	31				27				15
Net income (loss)	$	130			$	149			(13	)	%
Financial Ratios
Loss and LAE	87.7			%	89.0			%
Acquisition expense	17.3				16.9
Underwriting expense	13.5				12.9
Expense	30.8				29.8
Dividend	—				0.2
Combined ratio	118.5			%	119.0			%

SUPPLEMENTAL STATUTORY DATA	(Preliminary) March 31, 2012		December 31, 2011
(In millions)
Combined Continental Casualty Companies
Statutory surplus (1)	$	9,956	$	9,888
Life Company
Statutory surplus	$	529	$	519

(1) Represents the combined statutory surplus of Continental Casualty Company and its subsidiaries, including the Life Company, as determined in accordance with statutory accounting practices.

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CNA FINANCIAL CORPORATION

Financial Supplement

Property & Casualty Operations Loss & LAE Ratio Analysis

	CNA Specialty
	2012 YTD Evaluated at 3/31/12			2011 FY Evaluated at 12/31/11			2011 FY Evaluated at 3/31/12
Gross Accident Year	61.5		%	62.8		%	62.7	%
Impact of Reinsurance	6.5			4.9			4.8
Net Accident Year	68.0			67.7			67.5	%
Impact of Development and Other (1)	(1.7	)		(8.4	)
Net Calendar Year	66.3		%	59.3		%

	CNA Commercial
	2012 YTD Evaluated at 3/31/12			2011 FY Evaluated at 12/31/11			2011 FY Evaluated at 3/31/12
Gross Accident Year	70.7		%	72.9		%	73.8	%
Impact of Reinsurance	2.5			3.7			3.6
Net Accident Year	73.2			76.6			77.4	%
Impact of Development and Other (1)	(2.5	)		(5.7	)
Net Calendar Year	70.7		%	70.9		%

	P&C Operations
	2012 YTD Evaluated at 3/31/12			2011 FY Evaluated at 12/31/11			2011 FY Evaluated at 3/31/12
Gross Accident Year	65.3		%	67.3		%	67.3	%
Impact of Reinsurance	5.4			5.2			5.2
Net Accident Year	70.7			72.5			72.5	%
Impact of Development and Other (1)	(2.1	)		(7.0	)
Net Calendar Year	68.6		%	65.5		%

(1) Other includes the impacts of interest accretion and change in allowance for uncollectible reinsurance and deductible amounts.

15

CNA FINANCIAL CORPORATION

Financial Supplement

Net Carried Life & Group Non-Core Policyholder Reserves

March 31, 2012
(In millions)	Claim and claim adjustment expenses		Future policy benefits		Policyholders' funds		Separate account business
Long term care	$	1,523	$	6,497	$	—	$	—
Payout annuities	656		1,992		—		—
Institutional markets	2		14		109		402
Other	52		5		—		—
Total	$	2,233	$	8,508	$	109	$	402

The reserve amounts above are net of $1,354 million of ceded reserves and exclude $106 million of claim and claim adjustment expenses and $668 million of future policy benefits relating to Shadow Adjustments. To the extent that unrealized gains on fixed income securities supporting long term care products and payout annuity contracts would result in a premium deficiency if those gains were realized, a related decrease in Deferred acquisition costs and/or increase in Insurance reserves are recorded, net of tax, as a reduction of net unrealized gains through Other comprehensive income (Shadow Adjustments).

December 31, 2011
(In millions)	Claim and claim adjustment expenses		Future policy benefits		Policyholders' funds		Separate account business
Long term care	$	1,470	$	6,374	$	—	$	—
Payout annuities	660		1,997		—		—
Institutional markets	1		15		129		417
Other	53		5		—		—
Total	$	2,184	$	8,391	$	129	$	417

The reserve amounts above are net of $1,375 million of ceded reserves and exclude $95 million of claim and claim adjustment expenses and $627 million of future policy benefits relating to Shadow Adjustments.

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