CINCINNATI, Aug. 16 /PRNewswire-FirstCall/ -- Cincinnati Financial Corporation (Nasdaq: CINF) today announced that the board of directors voted at its regular meeting on August 13, 2010, to increase the regular quarterly cash dividend from 39.5 cents to 40 cents per share, payable October 15, 2010, to shareholders of record as of September 22, 2010.

At the new level, the indicated annual dividend is $1.60 per share. In 2009, cash dividends paid were $1.565 per share and dividends declared were $1.57 per share.

Kenneth W. Stecher, president and chief executive officer, commented, "The company has consistently increased dividends for 49 years, and the board of directors chose to continue that record for the benefit of our shareholders. This action demonstrates their confidence in our strong capital, liquidity and in our initiatives to improve earnings performance. Our capital management philosophy continues to consider the balance between future capital requirements to grow our business and returning capital to shareholders over time.

"In the first half of 2010, our profits were pressured by continuing price competition in the insurance marketplace and high catastrophe losses incurred by our policyholders. Year-to-date, shareholders have received cash dividends totaling more than our current earnings, and for their benefit, we also repurchased $10 million of our own shares. We believe our performance prospects are improving as we begin to realize benefits from our current growth and profitability initiatives. Our long-term perspective drives our long-term commitment through all market and economic cycles to create value for shareholders by investing in and expanding our insurance operations."

Cincinnati Financial Corporation offers business, home and auto insurance, our main business, through The Cincinnati Insurance Company and its two standard market property casualty companies. The same local independent insurance agencies that market those policies may offer products of our other subsidiaries, including life and disability income insurance, annuities and surplus lines property and casualty insurance. For additional information about the company, please visit www.cinfin.com.

    Mailing Address:        Street Address:
                             6200 South Gilmore
    P.O. Box 145496          Road
    Cincinnati, Ohio         Fairfield, Ohio
     45250-5496              45014-5141

Safe Harbor Statement

This is our "Safe Harbor" statement under the Private Securities Litigation Reform Act of 1995. Our business is subject to certain risks and uncertainties that may cause actual results to differ materially from those suggested by the forward-looking statements in this report. Some of those risks and uncertainties are discussed in our 2009 Annual Report on Form 10-K, Item 1A, Risk Factors, Page 23. Although we often review or update our forward-looking statements when events warrant, we caution our readers that we undertake no obligation to do so.

Factors that could cause or contribute to such differences include, but are not limited to:

    --  Unusually high levels of catastrophe losses due to risk concentrations,
        changes in weather patterns, environmental events, terrorism incidents
        or other causes
    --  Increased frequency and/or severity of claims
    --  Inadequate estimates or assumptions used for critical accounting
        estimates
    --  Recession or other economic conditions resulting in lower demand for
        insurance products or increased payment delinquencies
    --  Delays in adoption and implementation of underwriting and pricing
        methods that could increase our pricing accuracy, underwriting profit
        and competitiveness
    --  Inability to defer policy acquisition costs for any business segment if
        pricing and loss trends would lead management to conclude that segment
        could not achieve sustainable profitability
    --  Declines in overall stock market values negatively affecting the
        company's equity portfolio and book value
    --  Events, such as the credit crisis, followed by prolonged periods of
        economic instability or recession, that lead to:
        --  Significant or prolonged decline in the value of a particular
            security or group of securities and impairment of the asset(s)
        --  Significant decline in investment income due to reduced or
            eliminated dividend payouts from a particular security or group of
            securities
        --  Significant rise in losses from surety and director and officer
            policies written for financial institutions
    --  Prolonged low interest rate environment or other factors that limit the
        company's ability to generate growth in investment income or interest
        rate fluctuations that result in declining values of fixed-maturity
        investments, including declines in accounts in which we hold bank-owned
        life insurance contract assets
    --  Increased competition that could result in a significant reduction in
        the company's premium volume
    --  Changing consumer insurance-buying habits and consolidation of
        independent insurance agencies that could alter our competitive
        advantages
    --  Inability to obtain adequate reinsurance on acceptable terms, amount of
        reinsurance purchased, financial strength of reinsurers and the
        potential for non-payment or delay in payment by reinsurers
    --  Events or conditions that could weaken or harm the company's
        relationships with its independent agencies and hamper opportunities to
        add new agencies, resulting in limitations on the company's
        opportunities for growth, such as:
        --  Downgrades of the company's financial strength ratings
        --  Concerns that doing business with the company is too difficult
        --  Perceptions that the company's level of service, particularly claims
            service, is no longer a distinguishing characteristic in the
            marketplace
        --  Delays or inadequacies in the development, implementation,
            performance and benefits of technology projects and enhancements
    --  Actions of insurance departments, state attorneys general or other
        regulatory agencies, including a change to a federal system of
        regulation from a state-based system, that:
        --  Restrict our ability to exit or reduce writings of unprofitable
            coverages or lines of business
        --  Place the insurance industry under greater regulatory scrutiny or
            result in new statutes, rules and regulations
        --  Increase our expenses
        --  Add assessments for guaranty funds, other insurance related
            assessments or mandatory reinsurance arrangements; or that impair
            our ability to recover such assessments through future surcharges or
            other rate changes
        --  Limit our ability to set fair, adequate and reasonable rates
        --  Place us at a disadvantage in the marketplace
        --  Restrict our ability to execute our business model, including the
            way we compensate agents
    --  Adverse outcomes from litigation or administrative proceedings
    --  Events or actions, including unauthorized intentional circumvention of
        controls, that reduce the company's future ability to maintain effective
        internal control over financial reporting under the Sarbanes-Oxley Act
        of 2002
    --  Unforeseen departure of certain executive officers or other key
        employees due to retirement, health or other causes that could interrupt
        progress toward important strategic goals or diminish the effectiveness
        of certain longstanding relationships with insurance agents and others
    --  Events, such as an epidemic, natural catastrophe or terrorism, that
        could hamper our ability to assemble our workforce at our headquarters
        location
    --  Difficulties with technology or data security breaches could negatively
        affect our ability to conduct business and our relationships with
        agents, policyholders and others

Further, the company's insurance businesses are subject to the effects of changing social, economic and regulatory environments. Public and regulatory initiatives have included efforts to adversely influence and restrict premium rates, restrict the ability to cancel policies, impose underwriting standards and expand overall regulation. The company also is subject to public and regulatory initiatives that can affect the market value for its common stock, such as measures affecting corporate financial reporting and governance. The ultimate changes and eventual effects, if any, of these initiatives are uncertain.

SOURCE Cincinnati Financial Corporation