Second quarter figures broken down reflect pre-tax catastrophe losses of $45 million that will add 7.8 points and $35 million in non-catastrophe losses greater than $1 million, which will add 6.1 points to the second-quarter combined ratio, the company said.

In second-quarter 2001, the company said it had $35 million in pre-tax cat losses and $21 million in large losses.

The catastrophe losses for this year's second quarter resulted from wind, hailstorms and associated flooding that occurred during April, May and June, primarily in the Midwest and Mid-Atlantic states.

At $22.8 million, the largest loss event was a late April storm affecting policyholders across 13 states, the company said, adding that five other storms contributed to the loss total, including three June events with preliminary loss estimates totaling $15.6 million.

The company said that the after-tax earnings impact of the cat losses is estimated to be 18 cents per share. In second-quarter 2001, when the operating earnings came in at 29 cents per share for the second quarter, catastrophes had an impact of 14 cents per share.

The company also said that the non-catastrophe losses in excess of $1 million each, related to 23 occurrences, would affect after-tax second-quarter 2002 earnings by an estimated 14 cents per share. Last year's impact of similar large losses was only 8 cents per diluted share.

Chief Executive Officer John Schiff said, "Business growth and rising loss severity continue to lead to higher total large losses. When we also experience higher frequency of these larger losses, the impact on our quarterly combined ratio can move outside the range that we have been experiencing."

He added, "As we continue our efforts to ensure adequate pricing to compensate us for the risks we accept, we believe that over the longer term we will be able to maintain the ratio of larger losses to the total business in an acceptable range."

Noting that catastrophe losses for the first six months of 2002 are estimated at $59 million, contributing roughly 5.2 points to the first-half combined ratio, Mr. Schiff said the company's target full-year 2002 combined ratio of 101.3 "remains within reach, assuming a more normal level of catastrophe losses for the remainder of the year."

For first quarter 2002, the insurer's combined ratio was 96.3.

Last year, Cincinnati Financial's second-quarter and first-half combined ratios were 106.2 and 101.4, respectively. For the full year, the company reported a 103.6 combined ratio in 2001.

Cincinnati Financial plans to report final second-quarter results on July 25. A conference call to discuss the results will be held at 2:30 p.m. EDT on that day. Details regarding the Internet broadcast of the conference call can be found at www.cinfin.com on the Investors page.