The ratings reflect CIC’s superior risk-adjusted capitalization, historically strong operating performance and conservative loss reserving standards that have allowed for substantial favorable loss-reserve development on prior accident years. The ratings also consider the group’s generally conservative operating fundamentals, favorable balance sheet liquidity and growing use of predictive analytic modeling tools. Furthermore, the ratings recognize the successful distribution that is centered on harnessing strong, long-term relationships with local independent insurance agencies within CIC’s targeted regional markets. CIC's relationships with its agency base are strengthened by the local presence of field support associates, competitive commission structure and comprehensive portfolio of insurance products. The ratings also acknowledge the strong franchise value of CIC, which ranks among the top 30 property/casualty organizations in the United States based on net premiums written. Lastly, CIC benefits from the financial flexibility afforded by its parent, CINF, which maintains modest financial leverage and additional liquidity through its access to capital markets and lines of credit.The ratings of CSU reflect its excellent level of risk-adjusted capital, improved underwriting performance and the explicit and implicit support garnered from being part of CINF. Somewhat offsetting these positive rating factors are the execution risks associated with this relatively new excess and surplus (E&S) initiative, as CIC has not offered E&S coverages prior to 2008, coupled with challenging market conditions. The ratings of Cincinnati Life acknowledge its strong risk-adjusted capitalization, positive trends in first year and renewal ordinary life premiums, overall good credit quality of its investment portfolio and its role in CINF as a provider for life, disability income and annuity products. Even with a $25 million dividend paid in 2011 to its parent, Cincinnati Life’s risk-adjusted capitalization is more than sufficient to support its ratings. The company continues to focus on its core ordinary life line of business as it has de-emphasized annuity sales in the current year.