December 15, 2017

Chubb First Quarter Net Income per Share Increases 36%

Warren, NJ -(PRNewswire)- The Chubb Corporation [NYSE: CB] recently reported that net income in the first quarter of 2013 was $656 million, compared to $506 million in the first quarter of 2012. First quarter net income per share increased 36% to $2.48 in 2013 from $1.83 in 2012.

Operating income, which the company defines as net income excluding after-tax realized investment gains and losses, was $566 million in the first quarter of 2013 and $469 million in the first quarter of 2012. First quarter operating income per share increased 26% to $2.14 in 2013 from $1.70 in 2012.

The first quarter combined loss and expense ratio was 84.6% in 2013 and 90.2% in 2012. The impact of catastrophes on the first quarter combined ratio was 0.6 percentage points in 2013 and 0.8 points in 2012. Excluding the impact of catastrophes, the first quarter combined ratio was 84.0% in 2013 and 89.4% in 2012. The expense ratio for the first quarter was 32.3% in 2013 and 32.2% in 2012.

Chubb’s estimated overall gross and net losses from Storm Sandy remained unchanged from the amounts previously reported, although estimated commercial lines losses declined slightly and personal lines losses increased by a similar amount.

Net written premiums for the first quarter of 2013 increased 4% to $3.1 billion. Foreign currency translation had an insignificant effect on total premium growth in the first quarter. Premiums were up 3% in the U.S. and up 6% outside the U.S. (up 7% in local currencies).

Property and casualty investment income after taxes for the first quarter declined 6% to $288 million in 2013 from $308 million in 2012.

Net income for the first quarter of 2013 reflected net realized investment gains of $138 million before tax ($0.34 per share after tax). Net income for the first quarter of 2012 reflected net realized investment gains of $56 million before tax ($0.13 per share after tax).

“Chubb is off to a great start in 2013,” said John D. Finnegan, Chairman, President and Chief Executive Officer. “Operating income per share of $2.14 and net income per share of $2.48 were both the highest of any quarter in Chubb’s history. Our combined ratio was an outstanding 84.6%, reflecting the impact of higher rates, strong underlying underwriting performance and low catastrophe losses. We are also encouraged by the renewal rate increases we continued to obtain in all of our business units.”

During the first quarter of 2013, Chubb repurchased approximately 3.9 million shares of its common stock at a total cost of $326 million (an average cost per share of $82.86). As of March 31, 2013, there was $1.1 billion available for share repurchases under the current authorization.

Average diluted shares outstanding for the first quarter were 264.8 million in 2013 and 276.2 million in 2012.

Book value per share was $61.79 at March 31, 2013, compared to $57.37 at March 31, 2012 and $60.45 at December 31, 2012.

First Quarter Operations Review
Chubb Personal Insurance (CPI) net written premiums increased 5% in the first quarter to $987 million. CPI’s combined ratio for the quarter was 87.0%, compared to 85.5% in the first quarter of 2012. The first-quarter impact of catastrophes accounted for 3.9 percentage points in 2013, including a 2.6 point impact related to an increase in estimated CPI losses from Storm Sandy. In the first quarter of 2012, the impact of catastrophes was 1.2 points. Excluding the impact of catastrophes, CPI’s first quarter combined ratio was 83.1% in 2013 and 84.3% in 2012.

Net written premiums for Homeowners increased 3%, and the combined ratio was 82.5%. The impact of catastrophes in the first quarter accounted for 6.1 percentage points of the Homeowners combined ratio. Excluding the impact of catastrophes, the combined ratio for Homeowners was 76.4%. Personal Automobile premiums increased 7%, and the combined ratio was 94.0%. For Other Personal lines, premiums increased 9% and the combined ratio was 94.0%.

Chubb Commercial Insurance (CCI) net written premiums increased 2% in the first quarter to $1.4 billion. The combined ratio for the quarter was 81.9% in 2013 and 93.3% in 2012. The impact of catastrophes in the first quarter of 2013 improved CCI’s combined ratio by 1.7 percentage points as a result of a 2.1 point impact related to a decrease in estimated CCI losses from Storm Sandy. In the first quarter of 2012, the impact of catastrophes accounted for 0.9 percentage points of CCI’s combined ratio. Excluding the impact of catastrophes, CCI’s first quarter combined ratio was 83.6% in 2013 and 92.4% in 2012.

In the United States, average first quarter CCI renewal rates increased 8%, renewal premium retention was 84% and the ratio of new to lost business was 0.8 to 1.

Chubb Specialty Insurance (CSI) net written premiums increased 5% in the first quarter to $632 million. The combined ratio for CSI was 87.4%, compared to 93.6% in the first quarter of 2012.

Professional Liability (PL) net written premiums were up 2%, and the combined ratio was 92.4%. In the United States, average first quarter renewal rates for PL increased 9%, renewal premium retention was 81% and the ratio of new to lost business was 0.6 to 1.

Surety net written premiums were up 30%, and the combined ratio was 50.7%.

The complete earnings release is available here: Chubb First Quarter 2013 Earnings

Source: PRNewswire

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