<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-----------------------
FORM 10-Q
X Quarterly Report Under Section 13 or 15 (d) of the Securities Exchange Act
- --- of 1934
For the Quarterly Period Ended June 30, 1996
- --- Transition Report Pursuant to Section 13 or 15 (d) of the Securities
Exchange Act of 1934
-----------------------
Commission File Number 0-4604
CINCINNATI FINANCIAL CORPORATION
--------------------------------
(Exact name of registrant as specified in its charter)
An Ohio Corporation 31-0746871
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
6200 South Gilmore Road
Fairfield, Ohio 45014-5141
(Address of principal executive offices)
Registrant's telephone number, including area code: 513/870-2000
*Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports) and (2) has been subject to such
filing requirements for the past 90 days.
YES X , NO
------- -------
Securities registered pursuant to Section 12(g) of the Act:
$2.00 Par Common--55,766,615 shares outstanding at June 30, 1996
$80,000,000 of 5-1/2% Convertible Senior Debentures Due 2002
<PAGE> 2
PART I
ITEM 1. FINANCIAL STATEMENTS
CINCINNATI FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
(Unaudited)
June 30, December 31,
1996 1995
--------------- ---------------
<S> <C> <C>
ASSETS
Cash ................................................................. $ 10,117,346 $ 20,019,459
Investments
Fixed Maturities (Cost: 1996--$2,374,889,263;
1995--$2,298,718,542) ................................... 2,449,668,496 2,446,995,519
Equity Securities (Cost: 1996--$1,505,050,201;
1995--$1,423,671,759) ................................... 3,306,316,275 3,041,762,260
Other Invested Assets ....................................... 49,328,335 46,963,230
Finance Receivables .................................................. 23,026,796 20,281,562
Premiums Receivable .................................................. 173,853,503 161,116,592
Reinsurance Receivable ............................................... 113,490,585 103,682,717
Prepaid Reinsurance Premiums ......................................... 22,574,725 21,835,186
Investment Income Receivable ......................................... 68,502,493 65,045,195
Land, Buildings and Equipment for Company Use (at Cost
Less Accumulated Depreciation) .............................. 35,253,484 33,056,396
Deferred Acquisition Costs Pertaining to Unearned
Premiums and to Life Policies in Force ...................... 122,258,633 119,589,232
Other Assets ......................................................... 31,576,928 28,950,551
--------------- ---------------
Total Assets $ 6,405,967,599 $ 6,109,297,899
=============== ===============
LIABILITIES
- -----------
Insurance Reserves:
Life Policy Reserves ........................................ $ 421,926,089 $ 403,263,716
Losses and Loss Expenses .................................... 1,814,445,278 1,743,533,951
Unearned Premiums .................................................... 412,718,780 408,624,414
Notes Payable ........................................................ 252,709,344 221,005,282
5-1/2% Convertible Senior Debentures Due 2002 ....................... 80,000,000 80,000,000
Federal Income Taxes
Current ..................................................... 5,507,468 10,475,088
Deferred .................................................... 521,821,418 487,840,052
Other Liabilities .................................................... 91,451,692 96,584,203
--------------- ---------------
Total Liabilities 3,600,580,069 3,451,326,706
--------------- ---------------
SHAREHOLDERS' EQUITY
- --------------------
Common Stock, $2 per Share; Authorized 80,000,000
Shares; Issued 1996--55,788,002; 1995--53,084,081
Shares; Outstanding 1996--55,766,615; 1995--53,056,934
Shares ...................................................... 111,576,004 106,168,162
Paid-In Capital ...................................................... 400,008,693 237,171,509
Retained Earnings .................................................... 1,064,183,358 1,156,626,751
Unrealized Gain on Investments, Less Taxes ........................... 1,230,678,852 1,159,388,263
--------------- ---------------
2,806,446,907 2,659,354,685
Less Treasury Shares at Cost (1996--21,387 Shares;
1995--27,147 Shares) ........................................ (1,059,377) (1,383,492)
--------------- ---------------
Total Shareholders' Equity ......................... 2,805,387,530 2,657,971,193
--------------- ---------------
Total Liabilities and Shareholders' Equity ....... $ 6,405,967,599 $ 6,109,297,899
=============== ===============
</TABLE>
Accompanying notes are an integral part of these financial statements.
<PAGE> 3
CINCINNATI FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
<TABLE>
<CAPTION>
Six Months Ended June 30, Three Months Ended June 30,
------------------------- ---------------------------
Revenues: 1996 1995 1996 1995
- --------- ---- ---- ---- ----
<S> <C> <C> <C> <C>
Premiums Earned:
Property and Casualty ................... $670,843,484 $618,417,000 $337,471,448 $311,270,075
Life .................................... 25,043,469 21,676,950 13,090,538 10,727,106
Accident and Health ..................... 3,757,828 3,691,634 1,862,445 1,858,488
------------ ------------ ------------ ------------
Net Premiums Earned .................... 699,644,781 643,785,584 352,424,431 323,855,669
Investment Income, Less Expenses ............ 162,522,515 147,445,314 80,050,820 75,631,619
Realized Gain on Investments ................ 25,889,445 23,635,133 6,612,297 2,617,132
Other Income ................................ 5,783,402 4,844,563 2,954,147 2,918,375
------------ ------------ ------------ ------------
Total Revenues .......................... 893,840,143 819,710,594 442,041,695 405,022,795
------------ ------------ ------------ ------------
Benefits & Expenses:
Ins. Losses and Policyholder Ben ............ 539,929,072 471,041,115 267,174,308 237,656,089
Commissions ................................. 124,210,052 121,852,125 63,132,385 62,634,476
Other Operating Expenses .................... 54,983,897 46,660,856 28,454,992 21,855,762
Taxes, Licenses & Fees ...................... 21,706,451 19,356,089 11,802,041 10,411,477
Increase in Deferred Acquisition
Costs Pertaining to Unearned
Premiums and to Life Policies
in Force ................................ (2,669,401) (4,092,942) (2,325,243) (3,082,564)
Interest Expense ............................ 9,121,546 7,982,569 4,563,395 4,319,598
Other Expenses .............................. 3,087,578 3,458,467 2,217,465 1,598,507
------------ ------------ ------------ ------------
Total Expenses .......................... 750,369,195 666,258,279 375,019,343 335,393,345
------------ ------------ ------------ ------------
Income Before Income Taxes ................... 143,470,948 153,452,315 67,022,352 69,629,450
------------ ------------ ------------ ------------
Provision (Benefit) for Inc. Taxes:
Current ..................................... 34,032,377 39,084,866 14,111,044 17,771,499
Deferred .................................... (4,405,872) (4,017,730) (1,484,753) (3,282,629)
------------ ------------ ------------ ------------
Total ................................... 29,626,505 35,067,136 12,626,291 14,488,870
------------ ------------ ------------ ------------
Net Income ................................... $113,844,443 $118,385,179 $ 54,396,061 $ 55,140,580
============ ============ ============ ============
Weighted Average Shares Outstanding 57,819,408 57,652,014* 57,828,063 57,695,818*
============ ============ ============ ============
Per Common Share:
Total Net Income ........................ $ 1.99 $ 2.08* $ .95 $ .97*
============ ============ ============ ============
Cash Dividends Declared ................. $ .72 $ .63* $ .37 $ .33*
============ ============ ============ ============
</TABLE>
*Adjusted to reflect 5% stock dividend effective March 15, 1996.
Accompanying notes are an integral part of these financial statements.
<PAGE> 4
CINCINNATI FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY
(UNAUDITED)
SIX MONTHS ENDED JUNE 30, 1995 AND 1996
---------------------------------------
<TABLE>
<CAPTION>
Common Stock Treasury Paid-In Retained Unrealized
Shares Amount Stock Capital Earnings Capital Gains
------ ------ ----- ------- -------- -------------
<S> <C> <C> <C> <C> <C> <C>
Bal. Dec. 31,
1994 50,435,974 $100,871,948 $ (913,765) $105,791,761 $ 1,133,104,811 $ 601,192,480
Net Income 118,385,179
Change in Unreal.
Gains Net of
Inc. Taxes of
$124,727,599 231,636,969
Div. Declared (35,195,553)
5% Stock Div.
at Market 2,521,546 5,043,092 127,338,073 (132,564,883)*
Issuance of
Treasury Shares 10,465 4,437
Stock Options
Exercised 92,719 185,438 2,504,950
---------- ------------ ----------- ------------ --------------- --------------
Bal. June 30,
1995 53,050,239 $106,100,478 $ (903,300) $235,639,221 $ 1,083,729,554 $ 832,829,449
========== ============ =========== ============ =============== ==============
Bal. Dec. 31,
1995 53,084,081 $106,168,162 $(1,383,492) $237,171,509 $ 1,156,626,751 $1,159,388,263
Net Income 113,844,443
Change in Unreal.
Gains Net of
Inc. Taxes of
$38,387,240 71,290,589
Div. Declared (40,279,110)
5% Stock Div.
at Market 2,652,110 5,304,220 160,452,655 (166,008,726)*
Issuance of
Treasury Shares 324,115 515,287
Stock Options
Exercised 51,811 103,622 1,869,242
---------- ------------ ----------- ------------ --------------- --------------
Bal. June 30,
1996 55,788,002 $111,576,004 $(1,059,377) $400,008,693 $ 1,064,183,358 $1,230,678,852
========== ============ =========== ============ =============== ==============
</TABLE>
Accompanying notes are an integral part of these financial statements.
*Includes $183,718 and $251,851 for fractional shares in March 17, 1995 and
March 15, 1996, respectively.
<PAGE> 5
CINCINNATI FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
Six Months Ended June 30,
-------------------------
1996 1995
---- ----
<S> <C> <C>
Cash flows from operating activities:
Net income ............................................. $ 113,844,443 $ 118,385,179
Adjustments to reconcile operating income to net cash
provided by operating activities:
Depreciation and amortization ......................... 1,318,060 4,481,336
Increase in net unearned premiums ..................... 3,354,827 8,685,932
Increase in net life policy reserves .................. 18,662,373 14,423,193
Increase in net loss and loss expense reserves ........ 61,103,459 85,478,037
Increase in net premiums receivable ................... (12,736,911) (3,567,745)
Increase in deferred acquisition costs ................ (2,669,401) (4,092,942)
Decrease in other liabilities ......................... (7,979,882) (10,311,315)
Increase in investment income receivable .............. (3,457,298) (5,857,009)
Increase in accounts receivable ....................... (3,183,866) (1,446,138)
Decrease in deferred income taxes ..................... (4,405,872) (5,854,526)
Increase (Decrease) in current income taxes ........... (4,967,620) 9,497,385
Realized gain on investments .......................... (25,889,445) (23,635,133)
Other ................................................. (3,940,286) 1,684,260
------------- -------------
Net cash provided by operating activities ............ 129,052,581 187,870,514
------------- -------------
Cash flows from investing activities:
Sale of fixed maturities investments .................. 78,743,812 64,233,845
Maturity of fixed maturities investments .............. 133,911,701 112,954,561
Sale of equity securities investments ................. 100,078,311 164,065,642
Collection of finance receivables ..................... 4,852,197 3,981,692
Purchase of fixed maturities investments .............. (279,769,482) (363,332,837)
Purchase of equity securities investments ............. (160,832,659) (201,775,268)
Investment in land, buildings and equipment ........... (7,132,306) (5,627,325)
Investment in finance receivables ..................... (7,597,431) (6,087,139)
Investment in other invested assets ................... 1,958,424 1,023,400
------------- -------------
Net cash used in investing activities ................ (135,787,433) (230,563,429)
------------- -------------
Cash flows from financing activities:
Proceeds from stock options exercised ................. 1,972,865 2,690,388
Issuance of treasury shares ........................... 839,403 14,902
Increase in notes payable ............................. 31,704,062 67,970,234
Payment of cash dividends to shareholders ............. (37,683,591) (33,481,698)
------------- -------------
Net cash provided by (used in) financing activities .. (3,167,261) 37,193,826
------------- -------------
Net decrease in cash .................................... (9,902,113) (5,499,089)
Cash at beginning of period ............................. 20,019,459 48,254,464
------------- -------------
Cash at end of period ................................... $ 10,117,346 $ 42,755,375
============= =============
Supplemental disclosures of cash flow information
Interest paid ........................................ $ 10,117,173 $ 7,159,249
============= =============
Income taxes paid .................................... $ 39,000,000 $ 35,000,000
============= =============
</TABLE>
Accompanying notes are an integral part of these financial statements.
<PAGE> 6
CINCINNATI FINANCIAL CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
NOTE I - ACCOUNTING POLICIES
The consolidated financial statements include the accounts of the Company and
all of its subsidiaries, each of which is wholly owned, and are presented in
conformity with generally accepted accounting principles. All significant
inter-company investments and transactions have been eliminated in
consolidation. The December 31, 1995 consolidated balance sheet amounts are
derived from the audited financial statements but do not include all disclosures
required by generally accepted accounting principles.
INVESTMENTS--Fixed maturities and equity securities have been classified as
available for sale and are carried at fair values at June 30, 1996 and December
31, 1995.
UNREALIZED GAINS AND LOSSES--The increases (decreases) in unrealized gains for
fixed maturities and equity securities (net of income tax effect) for the
six-month and three-month periods ended June 30 are as follows:
<TABLE>
<CAPTION>
Fixed Equity
Maturities Securities Total
---------- ---------- -----
Six-Month Periods Ended
<S> <C> <C> <C> <C>
June 30, 1996 $(47,773,533) $ 119,064,122 $ 71,290,589
June 30, 1995 $ 92,746,757 $ 138,890,212 $ 231,636,969
Three-Month Periods Ended
June 30, 1996 $(26,245,457) $ (38,520,345) $ (64,765,802)
June 30, 1995 $ 45,439,678 $ 72,880,280 $ 118,319,958
</TABLE>
Such amounts are included as additions to and deductions from shareholders'
equity.
REINSURANCE--Premiums earned are net of premiums on ceded business, and
insurance losses and policyholder benefits are net of reinsurance recoveries in
the accompanying statements of income for the six-month and three-month periods
ended June 30 as follows:
<TABLE>
<CAPTION>
Ceded Reinsurance
Premiums Recoveries
-------- ----------
<S> <C> <C>
Six-Month-Periods Ended
June 30, 1996 $45,496,606 $18,776,455
June 30, 1995 $40,606,219 $28,217,348
Three-Month Periods Ended
June 30, 1996 $22,567,656 $ 8,846,722
June 30, 1995 $21,886,051 $13,599,806
</TABLE>
<PAGE> 7
NOTE II - STOCK OPTIONS
The Company has primarily qualified stock option plans under which options are
granted to employees of the Company at prices which are not less than market
price at the date of grant and which are exercisable over ten-year periods. On
June 30, 1996, outstanding options for Stock Option Plan No. III totalled 92,378
shares with purchase prices ranging from a low of $11.87 to a high of $22.03 and
outstanding options for Stock Option Plan No. IV totalled 1,163,676 shares with
purchase prices ranging from a low of $22.38 to a high of $61.50. All
outstanding shares have been adjusted for the 5% stock dividend declared
February 3, 1996, payable April 30, 1996 to shareholders of record of March 15,
1996.
At the Shareholders' meeting on April 6, 1996, the shareholders approved Stock
Option Plan V for 500,000 shares. No shares have been granted from this plan at
this time.
In October 1995, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards (SFAS) No. 123, "Accounting for Stock-Based
Compensation," which will be effective for the Company beginning January 1,
1996. SFAS No. 123 requires expanded disclosures of stock-based compensation
arrangements with employees and encourages (but does not require) compensation
cost to be measured based on the fair value of the equity instrument awarded.
Companies are permitted, however, to continue to apply APB Opinion No. 25, which
recognizes compensation cost based on the intrinsic value of the equity
instrument awarded. The Company will continue to apply APB Opinion No. 25 to its
stock based compensation awards to employees.
NOTE III INTERIM ADJUSTMENTS
The preceding summary of financial information for Cincinnati Financial
Corporation and consolidated subsidiaries is unaudited, but the Company believes
that all adjustments (consisting only of normal recurring accruals) necessary
for fair presentation have been made. The results of operations for this interim
period is not necessarily an indication of results to be expected for the
remaining six months of the year.
<PAGE> 8
ITEM 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
Premiums earned for the six months ended June 30, 1996 have increased
$55,859,197 (9%) over the six months ended June 30, 1995. Also, premiums earned
have increased $28,568,762 (9%) for the three months ended June 30, 1996 over
the three months ended June 30, 1995. For the six-month and three-month periods
ended June 30, 1996, the growth rate of our property and casualty subsidiaries
is greater than last year on both a gross written and earned premium basis. The
premium growth is attributable to increases in new business, and some rate
increases; however, these increases were somewhat offset by the continued
softness of the commercial lines market. The premium volume of our life and
health subsidiary has increased 13% for the six months ended June 30, 1996 and
19% for the three months ended June 30, 1996 compared to the comparable periods
of 1995. The premium growth in our life subsidiary is mainly attributable to
increased sales of both traditional and interest sensitive products. For the
six-month and three-month periods ended June 30, 1996, investment income, net of
expenses, has increased $15,077,201 (10%) and $4,419,201 (6%) when compared with
the first six months and second three months of 1995, respectively. This
increase is the result of the growth of the investment portfolio because of
investing cash flows from operations and dividend increases from equity
securities.
Realized gains on investments for the six months ended June 30, 1996 amounted to
$25,889,445 compared to $23,635,133 for the six-month period ended June 30,
1995, and $6,612,297 for the three-month period ended June 30, 1996 compared to
$2,617,132 for the three-month period ended June 30, 1995. The realized gains
are predominantly the result of the sale of equity securities and management's
decision to realize the gains and reinvest the proceeds at higher yields.
Insurance losses and policyholder benefits (net of reinsurance recoveries)
increased $68,887,957 (15%) for the first six months of 1996 over the same
period in 1995 and increased $29,518,219 (12%) for the second quarter when
compared to the second quarter of 1995. The losses and benefits of the property
and casualty companies have increased $64,197,584 for the six-month period and
increased $28,012,754 for the second quarter of 1996 compared to the comparable
periods for 1995. The losses for the first six months and for the second quarter
have increased because of the growth of new business and a higher incidence of
claims. Catastrophe losses were $37.2 million and $4.5 million, respectively,
for the first six months of 1996 and 1995 and were $24.8 million and $4.4
million, respectively, for the second quarter of 1996 and 1995. These losses
were substantially higher for the first six months and the second quarter of
1996 compared to the comparable periods of 1995 because of a higher incidence
and severity of these weather related claims.
Policyholder benefits of the life insurance subsidiary increased $4,690,373 for
the first six months of 1996 over the same period of 1995 and increased
$1,505,465 for the second quarter when compared to the second quarter of 1995.
The majority of the six-month and second quarter increase is the result of a
higher incidence of death and accident and health claims and related costs.
<PAGE> 9
Commission expenses increased $2,357,927 for the six-month period ended June 30,
1996 compared to the same period for 1995 and increased $497,909 for the second
quarter of 1996 compared to the same period in 1995. The increase is
attributable to the increases in new business. Other operating expenses
increased $8,323,041 for the six-month period ended June 30, 1996 compared to
the same period for 1995 and increased $6,599,230 for the second quarter of 1996
compared to the same period in 1995. The increase is the result of general wage
increases and the increase in the number of employees from 2,100 at December 31,
1994 to 2,375 at June 30, 1996 and the related expenses associated with the
production of new business.
Provision for income taxes, current and deferred, have decreased by $5,440,631
for the first six months of 1996 compared to the first six months of 1995 and
have decreased $1,862,579 for the second quarter of 1996 compared to the second
quarter of 1995. The decrease in federal taxes is primarily attributable to a
decline of the effective tax rate from 22.9% to 20.6% at June 30, 1995 and 1996,
respectively, and a decline of the effective tax rate from 20.8% to 18.8% for
the second quarter of 1995 and 1996, respectively.
Notes payable increased $31,704,062 for the first six months and increased
$31,240,687 for the second quarter of 1996. The Company borrowed the additional
funds to pay for the increased losses in the property and casualty companies
instead of paying the losses from cash flow because the Company decided to take
advantage of the investment opportunities that were available at that time.
Unrealized appreciation will fluctuate with changes in the overall fixed
maturities and equity securities markets. Changes in unrealized appreciation are
discussed in Note 1. The Company's equity investment portfolio continues to be
primarily investments in common stocks of public utility companies and financial
institutions.
<PAGE> 10
PART II
OTHER INFORMATION
ITEM 1. Legal Proceedings
-----------------
The Company is involved in no material litigation other than routine litigation
incident to the nature of the insurance industry.
ITEM 2. Changes in Securities
---------------------
On February 3, 1996, the Company declared a 5% stock dividend payable on April
30, 1996 to shareholders of record of March 15, 1996.
ITEM 3. Defaults Upon Senior Securities
-------------------------------
The Company has not defaulted on any interest or principal payment, and no
arrearage in the payment of dividends has occurred.
ITEM 4. Submission of Matters to a Vote of Security Holders
---------------------------------------------------
On April 6, 1996, the registrant held its Annual Meeting of Stockholders for
which the Board of Directors solicited proxies. The proposals voted on and
approved by the stockholders are as follows:
1. The election of six (6) Directors to serve until the Annual Meeting of
Stockholders in 1999.
2. Approval of the proposal to adopt Stock Option Plan V in the amount of
500,000 shares of common stock by a vote of 40,070,157 for, 804,549
against, and 287,214 abstaining.
3. Approval of the proposal to approve the Incentive Compensation Plan by a
vote of 38,949,050 for, 1,146,481 against, and 1,065,919 abstaining.
ITEM 5. Other Information
-----------------
No matters to report.
ITEM 6. Exhibits and Reports on Form 8-K
--------------------------------
(a) Exhibits included:
Exhibit 11--Statement re Computation of Per Share
Earnings.
Exhibit 27--Financial Data Schedule
(b) The Company was not required to file any reports on Form
8-K during the quarter ended June 30, 1996.
Signature
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 thereunto duly authorized.
CINCINNATI FINANCIAL CORPORATION
------------------------------------
(Registrant)
Date August 9, 1996
---------------------------------
By /s/ Robert J. Driehaus
------------------------------------
R. J. Driehaus
Senior Vice President and Chief
Financial Officer
(Principal Financial Officer)
<PAGE> 1
EXHIBIT 11
CINCINNATI FINANCIAL CORPORATION
STATEMENT RE COMPUTATION OF PER SHARE EARNINGS
(in thousands except for per share amounts)
<TABLE>
<CAPTION>
Six Months Ended Three Months Ended
June 30, June 30,
---------------- ---------------
1996 1995* 1996 1995*
---- ----- ---- -----
<S> <C> <C> <C> <C>
Weighted average shares outstanding 55,745 55,648 55,760 55,672
Equivalent shares assumed to be
outstanding for:
Stock options 282 212 276 232
Convertible debentures 1,792 1,792 1,792 1,792
-------- -------- ------- -------
Number of shares for primary
computation 57,819 57,652 57,828 57,696
Other dilutive equivalent shares--
stock options -0- -0- -0- -0-
-------- -------- ------- -------
Number of shares assuming full
dilution 57,819 57,652 57,828 57,696
======== ======== ======= =======
Net income $113,844 $118,385 $54,396 $55,140
Interest on convertible debentures--
net of tax 1,430 1,430 715 715
-------- -------- ------- -------
Net income for per share computation $115,274 $119,815 $55,111 $55,855
======== ======== ======= =======
Earnings per share:
Total Primary $ 1.99 $ 2.08 $ .95 $ .97
======== ======== ======= =======
Fully Diluted $ 1.99 $ 2.08 $ .95 $ .97
======== ======== ======= =======
</TABLE>
*Common shares and their equivalent have been adjusted to reflect the 5% stock
dividend effective March 15, 1996.
<TABLE> <S> <C>
<ARTICLE> 7
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> JUN-30-1996
<DEBT-HELD-FOR-SALE> 2,449,668,496
<DEBT-CARRYING-VALUE> 0
<DEBT-MARKET-VALUE> 0
<EQUITIES> 3,306,316,275
<MORTGAGE> 6,590,731
<REAL-ESTATE> 15,653,055
<TOTAL-INVEST> 5,805,313,106<F1>
<CASH> 10,117,346
<RECOVER-REINSURE> 2,405,025
<DEFERRED-ACQUISITION> 122,258,633
<TOTAL-ASSETS> 6,405,967,599
<POLICY-LOSSES> 2,186,651,442<F2>
<UNEARNED-PREMIUMS> 412,718,780
<POLICY-OTHER> 46,565,471<F2>
<POLICY-HOLDER-FUNDS> 9,259,355
<NOTES-PAYABLE> 332,709,344<F3>
<COMMON> 110,516,627<F4>
0
0
<OTHER-SE> 2,694,870,903<F4>
<TOTAL-LIABILITY-AND-EQUITY> 6,405,967,599
699,644,781
<INVESTMENT-INCOME> 162,522,515
<INVESTMENT-GAINS> 25,889,445
<OTHER-INCOME> 5,783,402
<BENEFITS> 539,929,072
<UNDERWRITING-AMORTIZATION> 144,634,318<F5>
<UNDERWRITING-OTHER> 65,805,805<F5>
<INCOME-PRETAX> 143,470,948
<INCOME-TAX> 29,626,505
<INCOME-CONTINUING> 113,844,443
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 113,844,443
<EPS-PRIMARY> 1.99
<EPS-DILUTED> 1.99
<RESERVE-OPEN> 1,580,742,006<F6>
<PROVISION-CURRENT> 0
<PROVISION-PRIOR> 0
<PAYMENTS-CURRENT> 0
<PAYMENTS-PRIOR> 0
<RESERVE-CLOSE> 1,649,821,125<F7>
<CUMULATIVE-DEFICIENCY> 0
<FN>
<F1>EQUALS THE SUM OF FIXED MATURITIES, EQUITY SECURITIES AND OTHER INVESTED ASSETS
<F2>EQUALS THE SUM OF LIFE POLICY RESERVES AND LOSSES AND LOSS EXPENSES LESS THE
LIFE COMPANY LIABILITY FOR SUPPLEMENTARY CONTRACTS WITHOUT LIFE CONTINGENCIES
OF $3,154,454 WHICH IS CLASSIFIED AS OTHER POLICYHOLDER FUNDS
<F3>EQUALS THE SUM OF NOTES PAYABLE AND THE 5-1/2% CONVERTIBLE SENIOR DEBENTURE
<F4>EQUALS THE TOTAL SHAREHOLDERS EQUITY
<F5>EQUALS THE SUM OF COMMISSIONS, OTHER OPERATING EXPENSES, TAXES LICENSES AND
FEES, INCREASE IN DEFERRED ACQUISITION COSTS, INTEREST EXPENSE AND OTHER
EXPENSES.
<F6>EQUALS THE NET RESERVE FOR UNPAID CLAIMS FOR THE PROPERTY CASUALTY SUBSIDIARIES
LESS LOSS CHECKS PAYABLE AS OF DECEMBER 31, 1995
<F7>EQUALS THE NET RESERVE FOR UNPAID CLAIMS FOR THE PROPERTY CASUALTY SUBSIDIARIES
LESS LOSS CHECKS PAYABLE AS OF JUNE 30, 1996
</FN>
</TABLE>
