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CNA FINANCIAL CORPORATION SENIOR DEBT RATING LOWERED TO 'AA';

 CHICAGO, March 5 /PRNewswire/ -- Duff & Phelps Credit Rating Co. has lowered the senior debt rating of CNA Financial Corporation (CNA) from AAA' (Triple-A) to AA' (Double-A). The preferred stock rating of CNA Financial Corporation has also been lowered from AA+' (Double-A-Plus) to AA-' (Double-A-Minus). The claims paying ability rating of the Continental Casualty Intercompany Pool has been lowered from AAA' (Triple-A) to AA+' (Double-A-Plus).
 The ratings had been placed on Rating Watch Feb. 9, 1993, with unfavorable implications following CNA's announcement that the Dec. 31, 1992, loss reserves of its Continental Casualty Company subsidiary were increased by $1.5 billion for asbestos-related bodily injury cases. The claims paying ability rating of Continental Assurance Company, which had also been placed on Rating Watch--Unfavorable, is now reaffirmed at AAA' (Triple-A). Approximately $412 million in debt and $150 million in preferred stock is impacted by this rating action.
 The downgrades reflect the increased operating leverage of the Continental Casualty Intercompany Pool, which is the principal operating unit contributing to earnings for CNA. On Feb. 8, 1993, CNA reported that its Continental Casualty Company subsidiary had increased its Dec. 31, 1992 claims reserve with respect to potential exposure to asbestos-related bodily injury cases by $1.5 billion, resulting in an after-tax charge of $990 million. In addition, the company reported a change in its accounting for certain workers' compensation and disability reserves that resulted in a $263 million after-tax benefit. As a result of these changes, record catastrophe losses, and depressed market conditions a net loss of $928 million (GAAP before accounting changes and capital gains) was recorded for 1992, as compared to net operating income of $289.7 million for the previous year. Statutory surplus at the property and casualty companies decreased to $3.1 billion at the end of 1992, from $3.9 billion at the end of the previous year.
 Members of the Continental Casualty Intercompany Pool are: Continental Casualty Company; National Fire Insurance Company of Hartford; American Casualty Company of Reading PA; Transcontinental Insurance Company; Columbia Casualty Company; Valley Forge Insurance Company; Transportation Insurance Company; CNA Casualty of California; and CNA Lloyd's of Texas.
 -0- 3/5/93
 /CONTACT: Timothy A. Bienek, 312-368-3192, or James B. Auden, CFA, 312-368-3146, both of Duff & Phelps Credit Rating Co./
 (CNA)


CO: CNA Financial Corporation ST: IN: INS SU: RTG

LR -- NY029 -- 3476 03/05/93 13:21 EST
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Date:Mar 5, 1993
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