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Also, a reconciliation of non-GAAP measures was provided with the news release. Statutory accounting data is prepared in accordance with statutory accounting rules and therefore, is not reconciled to GAAP. Now I'll turn over the call to Steve.

Steve Spray -- President and Chief Executive Officer

Good morning, and thank you for joining us today to hear more about our results. Our hearts go out to those impacted by the L.A. wildfires. You've lost homes, treasure belongings, a sense of community, and in the most devastating cases, loved ones.

I also want to thank the first responders who put their lives on the line, our agents for their support and partnership, and of course, our claims associates who are working tirelessly to help our policyholders with immediate needs and longer-term plans. Before I share more details about our current estimate for this catastrophe, let's dive into how we performed last year. Operating performance for the fourth quarter was very strong and many key areas showed improvements. We are also pleased with performance for full-year 2024, thanks to the superb work of our associates providing service to agents who we consider to be the best in the insurance business.

Our fourth-quarter results compared to the same period last year included a better combined ratio and excellent growth in premiums and investment income. The result boosted net income, and we had double-digit growth in operating income. Net income was $405 million for the fourth quarter of 2024 and included recognition of $107 million on an after-tax basis for the decrease in fair value of equity securities still held, an unfavorable swing of $931 million from the same period a year ago. Net income for the year rose 24%.

Non-GAAP operating income for the quarter increased 38% to $497 million and rose 26% for full-year 2024. Our 84.7% fourth-quarter 2024 property casualty combined ratio was 2.8 percentage points better than a year ago. It brought the full-year combined ratio to an outstanding 93.4%, 1.5 points better than 2023. The full-year improvement included a catastrophe loss ratio effect only 0.2 points lower.

Our 86.5% accident year 2024 combined ratio before catastrophe losses improved by 1.9 percentage points compared with accident year 2023, including 5 points of improvement for the fourth quarter. We reported another quarter of strong premium growth, which we believe its profitable growth as our underwriters diligently use pricing precision tools to support their risk segmentation efforts on a policy-by-policy basis. Estimated average renewal price increases for the fourth quarter were similar to the third quarter of 2024. Commercial lines moved slightly lower in the high single-digit percentage range and excess and surplus lines remained in the high single-digit range.

Our personal lines segment was also similar to the third quarter with personal auto in the low double-digit range and homeowner in the high single-digit range. New business growth produced by agencies representing Cincinnati Insurance continued at a nice pace. Nearly one-third of the growth for the year was from agencies appointed since the beginning of 2023, reflecting our strategy of appointing additional agencies where we identify appropriate expansion opportunities. Policy retention rates in 2024 were similar to last year, with our Commercial Lines segment up slightly but still in the upper 80% range.

Our Personal Lines segment remained in a similar position of the low to mid-90% range. The overall result was consolidated property casualty net written premium growth are growing 17% for the quarter, including 15% growth in agency renewal premiums and 23% in new business premiums. Next is a brief review of performance by Insurance segment for full-year 2024 compared with 2023. Most metrics also improved on a fourth-quarter basis.

Commercial Lines grew net written premiums 8% with an excellent combined ratio that improved by 3 percentage points to 93.2%. Personal Lines grew net written premiums 30% and improved the combined ratio by 2.9 percentage points to 97.5%. Excess and Surplus lines grew net written premiums 15% with a 94% combined ratio. Although that was 3.4 percentage points higher than last year, it's still quite profitable.

Both Cincinnati Re and Cincinnati Global were also very profitable. Cincinnati Re grew net written premium 7% with an 85% combined ratio while Cincinnati Global's growth was 8% with a 73.6% combined ratio. Our life insurance subsidiary also improved its results with a 21% increase in 2024 net income and term life insurance earned premium growth of 3%. These strong results combined to bring our value creation ratio and above our target of 10% to 13% on a 5-year average basis.

Our fourth-quarter DCR was 1.8%, and we reached 19.8% on a full-year basis. Net income before investment gains or losses for the year contributed 9.9%, higher overall valuation of our investment portfolio and other items contributed to the other half. Before I turn the call over to Mike, I'll provide our current estimates of financial effects related to the recent California wildfires and an update on our 2025 reinsurance program. We estimate first quarter 2025 pre-tax catastrophe losses of approximately $450 million to $525 million net of reinsurance recoveries.

That includes approximately 73% for our Personal Lines Insurance segment, 24% for Cincinnati Re, and 3% for Cincinnati Global. We reinstated the applicable layers of our primary property catastrophe reinsurance treaty coverage and will seed additional premiums to our reinsurers. Cincinnati Re will receive additional premiums from treaties reinstated. The estimated net effect of first-quarter premium revenue is a decrease of $50 million to $60 million.

To keep this event in perspective, had the wildfire effect occurred in 2024, we believe we would still have earned a modest underwriting profit. On January 1st of this year, we again renewed each of our primary property casualty treaties that transfer part of our risk to reinsurers. For our per-risk treaties, we increased our retention for the property treaty to $15 million, while retention for the casualty treaty remained at $10 million. Other terms and conditions for 2025 are fairly similar to 2024.

The primary objective for our property catastrophe treaty is to protect our balance sheet. The treaty's may change this year is adding another $300 million of coverage, increasing the top of the program from $1.2 billion to $1.5 billion. We again retained all of the first $200 million, then retain 56% of the next $100 million, 25% of the next $100 million and approximately 14% of the next $1.1 billion. Now let me turn the call over to chief financial officer, Mike Sewell, for additional highlights of our financial performance.

Mike Sewell -- Chief Financial Officer

Thank you, Steve, and thanks to all of you for joining us today. Investment income reached $1 billion for the year and significantly contributed to our improved operating performance. It grew 17% for the fourth quarter and 15% for the full year 2024 compared with the same periods of last year. Dividend income was down 4% in the fourth quarter, driven by third-quarter sales of equity securities from previously disclosed rebalancing of our investment portfolio.

Bond interest income grew 28% for the fourth quarter this year. Net purchases of fixed maturities securities totaled $1.1 billion for the quarter and $2.5 billion for the year. The fourth-quarter pre-tax average yield of 4.93% for the fixed maturity portfolio was up 45 basis points compared with last year. The average pre-tax yield for the total of purchased taxable and tax-exempt bonds during 2024 was 5.66%.

Valuation changes in aggregate for the fourth quarter were unfavorable for both our equity portfolio and our bond portfolio. Before tax effects, the net loss was $136 million for the equity portfolio and $350 million for the bond portfolio. At the end of the fourth quarter, the total investment portfolio net appreciated value was approximately $6.7 billion. The equity portfolio was in a net gain position of $7.2 billion, while the fixed maturity portfolio was in a net loss position of $553 million.

Cash flow in addition to higher bond yields continue to benefit investment income growth. Cash flow from operating activities for full-year 2024 was $2.6 billion, up 29% from last year. Regarding expense management, our objective is to balance spending control efforts with investing strategically in our business. Our 29.9% full-year 2024 property casualty underwriting expense ratio was in line with 2023 in total and for each major expense category.

The fourth quarter ratio was 1.4 percentage points lower than last year primarily due to lower accruals for agency profit sharing commissions in addition to premium growth outpacing the increase in employee-related expenses. My next topic is loss reserves, where our approach remains consistent and aims for the net amounts in the upper half of the actuarially estimated range of net loss and loss expense reserves. As we do each quarter, we consider new information such as paid losses and case reserves. Then we updated estimated ultimate losses and loss expenses by accident year and line of business.

During 2024, our net addition to property casualty loss and loss expense reserves was $1.1 billion, including $998 million for the IBNR portion. We experienced $236 million of property casualty net favorable reserve development on prior accident years that benefited the combined ratio by 2.7 percentage points during 2024. For our commercial casualty line of business, there was no material reserve development for any prior accident year during the fourth quarter. On an all-lines basis by accident year, net reserve development during 2024 included a favorable $369 million for '23, favorable $63 million for '22, favorable $5 million for '21, and an unfavorable $201 million in aggregate for accident years prior to '21.

My final comments highlight our capital management activities. For full-year 2024, we returned capital to shareholders through $490 million of dividends paid in addition to share repurchases. Shares repurchased totaled 1.1 million shares at an average price of approximately $113 per share, including an immaterial amount during the fourth quarter. We believe our financial flexibility and our financial strength are both in excellent position.

Parent company cash and marketable securities at year-end totaled $5.2 billion. Debt to total capital remained under 10%. And our quarter-end book value was at a record high $89.11 per share with nearly $14 billion of GAAP consolidated shareholders' equity providing plenty of capacity for profitable growth for all of our insurance operations. Now I'll turn the call back over to Steve.

Steve Spray -- President and Chief Executive Officer

Thanks, Mike. 2025 marks the 75th anniversary of the Cincinnati Insurance Company. Over that time, we've come to understand the importance of stability, consistency, and financial strength. We understand that we are in the business of accepting risk.

We plan for it, we price for it. We spend considerable time and effort focused on appropriately balancing growth and profitability through geographic and product diversification, pricing risk management. No one expects to experience a catastrophic loss such as those thought by the people who found themselves in the paths of Hurricanes Helene and Milton or the California wildfires. However, it's in the aftermath of these events that Cincinnati Insurance can shine confident in our financial strength.

Our claims associates can focus on delivering fast, fair, an empathetic service. At the same time, we are ready to build value for shareholders. The board recently reinforced their confidence in our strategy by declaring a 7% dividend increase payable in April and paving the way to extend our streak of increasing dividends to 65 years. As a reminder, with Mike and me today are Steve Johnston, Steve Soloria, Marc Schambow, and Theresa Hoffer.

Gary, please open the call for questions.

Questions & Answers:

Operator

[Operator instructions] Our first question today comes from Michael Phillips with Oppenheimer. Please go ahead.

Mike Phillips -- Oppenheimer and Company -- Analyst

Thank you. Good morning, everybody. I just want to start off, I guess, Steve, want to get perspective on higher-level question on the outlook for the reinsurance sector in the aftermath of California. I guess how do you see capacity as the year progresses? How do you expect Cincinnati Re to respond? And then maybe how to translate into kind of premium for 2025 for that segment? Thanks.

Steve Spray -- President and Chief Executive Officer

Yeah. Are you talking specifically on Cincinnati Re or Seeded Re?

Mike Phillips -- Oppenheimer and Company -- Analyst

First all your thoughts Yes, just your thoughts on the market in general broadly for the industry, how it responds. -- and then kind of drill down to how you guys -- it looks going to be some opportunities, how you guys would respond and what does that mean for Cincinnati Re?

Steve Spray -- President and Chief Executive Officer

Yeah. Maybe I'll start with just the reinsurance market to your question, Mike. First is I think the reinsurers appropriately, the last couple of years, I think, have shown just the industry itself has shown an underwriting profit. I think that's good.

That's healthy. We all need that. I'll speak specifically for Cincinnati Insurance. We've just got such long-term relationships and partnerships with our seeded partners, our reinsurers and talk to them on a regular basis, obviously.

We expect to pay all of our losses ground up plus the reinsurer's margin over time. We need them healthy. They know that. We've traded with them that way over time, and that won't change, no remarks there.

Cincinnati Re, they're going to stay the course. You heard extremely profitable 2024 inception to date with Cincinnati Re. -- is very profitable as well. They plan for CAT.

That's what they do. Their losses on -- specifically on the California wildfires were within expectation. And they'll proceed throughout the year with their 2025 plan. No change.

Mike Phillips -- Oppenheimer and Company -- Analyst

OK. Thanks, Steve. Next question is I asked, I wouldn't classify your Morelli exposure in general for your company is tiny, but it's real not outsized. But a question related to sort of umbrella.

In Personal Lines, I think this quarter -- in Personal Lines, I didn't see a lot of change in claim connectivity in that two to five layer. But dollar amount did move up. So something is there, 10 plus $25 million, $35 million of loss in the two to five. Any color you can add on anything in a quarter specifically that would help justify that extra amount of dollars in that layer and then more broadly after the quarter, anything you're seeing in umbrella excess layers that would cause any concerns? Thank you.

Steve Spray -- President and Chief Executive Officer

Thanks, Mike. I appreciate the question. Now looking at a quarter for umbrella, whether it be commercial or personal. I think it's going to it's going to kind of mislead you a little bit.

I think you got to pull back to more of an annual number. There's just -- the frequency with umbrella is obviously very low. It's a severity line. There's inherent volatility in it.

So we look at every single large loss we have in every line of business we have and look for trends, whether it be by state, by agents class of business, that's -- obviously, I'm speaking to commercial. We do the same thing for Personal Lines as well. So we don't see anything in that commercial book -- or excuse me, in that Personal Lines umbrella book that causes us any concern.

Mike Phillips -- Oppenheimer and Company -- Analyst

OK, Steve, thank you and congrats on the quarter. Appreciate it.

Steve Spray -- President and Chief Executive Officer

Yeah. Thanks so much, Mike. Appreciate it.

Operator

The next question is from Gregory Peters with Raymond James. Please go ahead.

Gregory Peters -- Raymond James -- Analyst

Good morning. I want to go back to the comment on loss. Could you provide some perspective on -- I think you said $50 million to $60 million of reinstatement costs what the gross loss might be or what you're pegging for using for your gross loss number? And -- just trying to figure out how far up the tower you went.

Steve Spray -- President and Chief Executive Officer

Yeah. Thanks, Greg. And as you can imagine, this is an active, still an active cat. And for right now, our range, our net range that we're providing you is our best estimate of ultimate loss and we're going to just stick with that net range of the $450 million to $525 million -- just not there's so many moving parts right now, Greg, just providing a gross number is -- we're not ready to go.

Gregory Peters -- Raymond James -- Analyst

And can maybe pivot away from that then and just I know the -- there was a call recently with insurance regulator and the governor and a bunch of insurance companies. And it feels like there's some movement to making -- allowing more rate activity in homeowners to compensate for the fire risk. Can you talk about what your perspective is of that market looking for once we get through paying all the losses.

Steve Spray -- President and Chief Executive Officer

Yeah, sure. One thing I'd point out for the Cincinnati book is 77% of our homeowner premiums in California today are on a non-admitted basis. On the admitted side, I don't -- I think it's pretty well documented. I don't think it's any secret that California is a challenging market.

We've got great agents and policyholders, and we want to support them. as you can imagine also, after -- I just mentioned any individual single large loss and also after any cat event, we do dive as a company and objectively look at everything, regardless of the event and determine if there's lessons learned, there's always lessons learned. But there's anything we need to do in changing our strategy moving forward, if anything. We'll obviously do that here with California and with the wildfires, and there's just a lot of -- as you can imagine, Greg, there's a lot of moving parts with this as well.

And yes, the regulation rate environment and things of that nature, there's a long list of things that we will look at. But I think right now, we are really focused on paying claims fairly, empathetically face to face. And the lessons learned, although we're looking at them actively -- that will take a little longer to really formulate if we're going to make any changes going forward.

Gregory Peters -- Raymond James -- Analyst

OK. I'll pivot away from that line of question. Just my question broadly in is there's -- in the commercial lines market, maybe in the personal lines market ex-California, just a growing sense that the pricing cycles kind of peaked, maybe it's moderating price increases aren't as robust and some instances are going down. Can you remind us and just give us a snapshot of where you were at the end of the year? And I know part of your book has multiyear policies.

Can you give us a snapshot of where those policies reside and what the percentage of the total was?

Steve Spray -- President and Chief Executive Officer

Yeah, sure. So as we just talked about on the -- for the major lines of business, commercial property, general liability, and auto were in the high single-digit range. Work comp is down in the mid-single-digit range. That's been -- that's been pretty well documented.

So we're still seeing rate in book. But I think the point estimate or the average, Greg, just doesn't -- it doesn't tell the story for us. Our underwriters at the desk level working with agents using the precision -- the pricing tools that they have. So there's a large percentage of our book of business.

And as you know, we're a package underwriter, that may just as an example, may get a flat increase. And there is a percentage of our book, it's albeit smaller, may get 20% or 30% being is that we are in -- we're underwriting and pricing policy by policy, risk by risk. So we're still seeing rate come into the book, the rate from last year, 18 months ago was still earning into the look. So I suspect here throughout 2025, you'll still see rate coming into that commercial lines book.

Gregory Peters -- Raymond James -- Analyst

Thank you for your answers.

Steve Spray -- President and Chief Executive Officer

Sure. Thank you, Greg.

Operator

The next question is from Dean Criscitiello with KBW. Please go ahead.

Dean Criscitiello -- Keefe, Bruyette and Woods -- Analyst

Hi. I wanted to start and sort of dive deeper into the reserve striking, both in the commercial auto excess and surplus line segment. I was just sort of curious like if there's anything else you could provide on sort of the accident years that the strengthening from? And what sort of trends you're seeing in those lines?

Mike Sewell -- Chief Financial Officer

Yes. Thanks for the question, Dean. This is Mike Sewell. So yes, you're keying in on a couple of points there.

So on the personal auto, it's really, I think our case incurred for some of the liability coverages that are in there. We're showing an upward trend. And I would say that those were mostly for the 2023 and the 2022 accident years mostly -- so that's where you saw a little bit of reserve strengthening there. And then as it relates to the surplus lines, our case incurred are there.

They were just -- they were just materializing greater than what we had expected. E&S is about 90% casualty, at least of our book. So it's really kind of similar to the industry averages that we're seeing with inflation, etc. So more prudent reserving was there.

And as I indicated, we added $998 million of IBNR. So for the overall book, about a third of that went to commercial casualty. So just prudent reserving, watching what we're doing, and being consistent with our process. So thanks for the question.

Dean Criscitiello -- Keefe, Bruyette and Woods -- Analyst

Yes. Got it. That makes sense. And then just quickly on the commercial property like current accident near ex cat lost ratio.

It seemed abnormally low this quarter? Or is there any other color you could provide on and why the profitability was so strong this quarter?

Steve Spray -- President and Chief Executive Officer

Sure. Dean, this is Steve Sprague. Yes, we'll take it. It -- but what's driving that was just a drop in large losses has drove the absolute lion's share of those commercial property results.

But I would be -- you can get volatility with those large losses quarter to quarter. We've had it where it's gone the other way. So again, I prefer to look at the kind of the full year -- our teams, I'd be remiss if I didn't talk about Commercial Lines underwriting teams working with the agents and underwriting that commercial property book. it was running a bit of a temperature.

And so just as we always do, all hands on deck with risk selection and pricing segmentation got us in a good spot there.

Dean Criscitiello -- Keefe, Bruyette and Woods -- Analyst

Got it. Thank you.

Steve Spray -- President and Chief Executive Officer

Thank you.

Operator

[Operator instructions] The next question is from Michael Zaremski with BMO Capital Markets. Please go ahead.

Unknown speaker -- -- Analyst

Hi. Good morning. It's Dan on for Mike. If I could just go back to adding to commercial casualty, IBNR, you're still adding to those levels year over year, maybe a little less so in magnitude in 2023.

But can you just talk about the loss cost inflation trend that you're seeing now and how that's changed throughout the year? Thanks.

Steve Spray -- President and Chief Executive Officer

Sure. Mike, Steve Spray again. Yes, as you know, we don't disclose a specific loss increase. But maybe I'll hit this a little broader too, is we feel -- we feel that our rates, our premiums, again, this is on a prospective basis, everything we do with ratemaking is prospective that our pricing is exceeding or matching loss costs.

And the only one caveat on that would be with the workers' compensation line of business.

Unknown speaker -- -- Analyst

OK. Thanks. And then maybe just on the casualty trend. How much of that would you say is a reaction to since these contractors, industry exposure? Some peers have talked about this industry as being overly exposed to social inflation.

Steve Spray -- President and Chief Executive Officer

Yeah. I can't say that we have seen the construction business, at least the business that we write, Mike, overly exposed to social inflation. A lot of the social inflation we see is into the umbrella of auto -- commercial auto losses. We do back to the construction piece.

We do watch closely, and it really depends on the jurisdiction you're in or the venue in construction defect claims can be a challenge from time to time, and maybe that's what they're referring to. But for our construction book, which would be small to mid-market, particularly trade contractors and such, with that mix of business, -- we haven't seen -- I can't say we've seen the social inflation into our construction book.

Unknown speaker -- -- Analyst

OK. Thanks. Then also just on workers' comp, you mentioned that's the only line of business where you're seeing trend above pricing. Just there was an acceleration of reserve leases and comp this year.

Are there any thoughts to maybe adjusting that pick going forward or taking some more of the good news upfront?

Steve Spray -- President and Chief Executive Officer

Well, that's something that we talk regularly here with the actuarial team, and they're taking a look at it all the time. So I don't have anything to report on that, Mike. Obviously, I've been talking about the deterioration of work comp pricing for -- I don't know how long now and calendar year wise, the results continue to be favorable. So we'll take it.

But your point is also well taken as far as just understanding and maybe taking a different view of it. We'll leave that in the hands or in discussions with the actuaries.

Unknown speaker -- -- Analyst

Thank you.

Operator

This concludes our question-and-answer session. I would like to turn the conference back over to Steve Spray for any closing remarks.

Steve Spray -- President and Chief Executive Officer

Thank you, Gary, and thank you all for joining us today. We look forward to speaking with you again on our first-quarter 2025 call.

Operator

[Operator signoff]

Duration: 0 minutes

Call participants:

Dennis E. McDaniel -- Investor Relations Officer

Steve Spray -- President and Chief Executive Officer

Mike Sewell -- Chief Financial Officer

Mike Phillips -- Oppenheimer and Company -- Analyst

Gregory Peters -- Raymond James -- Analyst

Dean Criscitiello -- Keefe, Bruyette and Woods -- Analyst

Unknown speaker -- -- Analyst

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Cincinnati Financial (CINF) Q4 2024 Earnings Call Transcript was originally published by The Motley Fool