Furthermore, CNA probably has a better wherewithal to take on such charges than other companies, Ms. Horvath said, because they have the backing of Loews, which has contributed considerable capital to CNA over the past few years, "and that's been real capital, real hard cash."

Peter Patrino, an analyst at New York-based Fitch Ratings, which affirmed current ratings on CNA Financial and its primary p-c insurance subsidiaries with "negative" outlook, said Fitch's perspective wasn't so much on the size of the charge. Rather, "our focus was more on the net impact on the balance sheet. And in our opinion, some reserve uncertainty has been removed, and that helps us out," he said.

Currently, Fitch has "A-minus" insurer financial strength ratings on CNA's Continental Casualty Company Pool and Continental Insurance Company Pool.

Additionally, Standard & Poor's Ratings Services in New York said its ratings on New York-based Loews remain on CreditWatch with "negative" implications.

Moody's Investors Service, on the other hand, has lowered credit ratings of CNA Financial, with senior unsecured debt rating downgraded to "Baa3" from "Baa2." But the ratings agency confirmed the "A3" insurance financial strength ratings of CNA's p-c insurance subsidiaries, members of the Continental Casualty Company and Continental Insurance Company intercompany pools.

Speaking on a conference call with analysts yesterday shortly after the announcement, Stephen Lilienthal, chief executive officer of the CNA insurance companies, said taking the reserve charge of this magnitude was "a very painful, protracted, but necessary" process.

But Mr. Lilienthal said the company has developed a capital plan, including "substantial support" from its parent company Loews, following its reserve charges. Going forward, he explained, Loews has agreed to buy $750 million of new CNA non-voting convertible preferred stock, with the proceeds designed to boost the statutory surplus of CNA's principal insurance unit, Continental Casualty Company.

Loews has also committed up to $500 million of additional capital support by buying surplus notes of Continental Casualty, he said. Furthermore, CNA's capital plan also includes a number of other initiatives, including possible sales or other dispositions of businesses and assets.