July 16 (Reuters) - Property and casualty insurer Cincinnati Financial Corp estimated a significantly lower impact due to catastrophe losses during the second quarter and said it expects to continue to benefit from favorable pricing trends.
The company estimated pretax catastrophe losses of about $140 million to $160 million during the quarter, of which its commercial lines insurance segment accounted for almost two-thirds, it said in a statement.
It estimated an impact of 17 to 19 percentage points on the combined ratio due to catastrophe losses in the quarter, lower than the 40 points recorded a year earlier. The combined ratio is the percentage of premium revenue an insurer has to pay out in claims and expenses.
It expects a combined ratio of 108 percent to 112 percent for the quarter, Cincinnati Financial said in a statement.
A combined ratio of less than 100 percent indicates underwriting profitability, while anything over 100 indicates an underwriting loss.
“We expect to continue benefiting from improved pricing precision and loss cost containment, as well as improving market conditions,” Chief Executive Steven Johnston said in a statement.
Shares of the company, which is scheduled to release second-quarter results on July 26, were down 2 percent at $37.46 in early trade on Monday on the Nasdaq.