Kenneth W. Stecher, president and chief executive officer, commented, “While the economy and price competition continue to challenge our insurance business, the metrics we use to measure our success moved in a distinctly positive direction in the third quarter. Operating income of $96 million or 59 cents per share surpassed the amounts reported since the first quarter of 2008. Pre-tax investment income nearly reached the level of the 2008 third quarter, on track to resume a growth trend by year-end 2009.

“Our property casualty insurance operations benefitted from atypically low catastrophe losses, strong reserves and some stabilization of pricing. We achieved $36 million of pre-tax underwriting profit and a combined ratio of 95.1 percent for the third quarter, our best result since the fourth quarter of 2007. As expected, our workers’ compensation and homeowner lines of business continued to underperform. For both of these lines, we are using predictive modeling techniques to improve the accuracy of our pricing for each account and to target best-of-class accounts. Early results show positive impacts on pricing and verify the trend to higher quality accounts, which should, over time, return these lines to profitability.

“We are satisfied with third-quarter results relative to other recent quarters, recognizing that we still have work to do. As we navigate through a difficult period for our company, our industry and economy, we continue to sharply focus on initiatives that have just begun to bear fruit and have strong potential to drive future profitable growth,” Stecher said. “During the third quarter, we saw clear indications that these efforts are increasing current opportunities and opening new ones. Among those indications was a healthy amount of new business that directly resulted from our initiatives, helping offset lower premiums resulting from lower policyholder sales and payrolls used to calculate premiums. We continue to decline underpriced business, giving up short-term revenue to protect long-term profitability.”

Stecher continued, “We are making good progress in expanding our product lines and pursuing geographic diversification. Our new surplus lines subsidiary has been well received by our independent agent representatives, and it is contributing steadily to new business. Our entry into additional states is going well, with business building at a good pace in Texas, New Mexico and eastern Washington. In September, we appointed our first Wyoming agency, expanding the marketing territory that includes northern Colorado. We’re receiving rollover books of personal lines business in areas where we recently expanded that product line.

“Our technology initiatives also are proceeding on time and on budget. In October, we put our new policy administration system for commercial packages and auto policies into production in five states accounting for approximately 40 percent of our commercial lines premium. The system makes it easier for agents to serve the insurance needs of the businesses in their communities, offering efficiencies such as direct billing by the company and the ability to quote and issue policies in real time directly from their agency systems. We expect to have this system in six more states before year-end, with 19 additional states scheduled for 2010.

“Our expansion and technology initiatives support our long-term strategies. First, we are working to improve profitability by introducing more efficient systems and enhancing our underwriting capabilities. Second, we are driving premium growth by making it more attractive for agents to do business with us and by moving toward a larger footprint that also reduces volatility of our results associated with weather-related catastrophes. We also continue to make progress with the third part of our long-term strategy, to preserve capital. Our investment portfolio is actively managed, with an eye toward the appropriate balance between current income and the potential for capital appreciation that benefits shareholders.”

Stecher concluded, “Significantly exceeding year-end 2008 levels, shareholders’ equity rose to $4.626 billion and book value per share rose to $28.44 at the end of the third quarter. The increase helped take our value creation ratio for the year-to-date period to the 15 percent level earlier than anticipated. Our target for this measure is a 12 percent to 15 percent average for the five-year period of 2010 through 2014. The value creation ratio is the sum of our rate of growth in book value per share plus the ratio of dividends declared per share to beginning book value. It captures the contribution of our insurance operations, the success of our investment strategy and the importance we place on paying cash dividends to shareholders.

“During the third quarter, our board of directors increased the indicated annual dividend for a 49^th consecutive year, raising the quarterly dividend paid October 15 by a half cent to 39.5 cents. This gesture signaled their confidence that we are moving steadily in the right direction, as verified by underwriting profit in the third quarter. We are eager to further pursue the new opportunities we have just begun to tap.”

Additional information is available on our Web site, www.cinfin.com/investors, including an audio replay of the October 29^th conference call webcast.