- Net income and core operating income were each $2.04 billion, up 157.8% and 55.4%, respectively.
For the nine months, net income was $5.73
billion, up 45.5%, and core operating income was a record
$5.93 billion, up 24.7%.
- P&C net premiums written in the quarter were up 8.4%.
Global P&C, which excludes Agriculture, was up 12.3%, with
commercial insurance up 10.3% and consumer insurance up 17.6%.
North America was up 8.9%,
including growth of 9.6% in personal insurance and 8.7% in
commercial insurance with P&C lines up 10.5% and financial
lines up 1.1%. Overseas General was up 21.4%, with growth of 28.4%
in consumer insurance and 17.0% in commercial insurance. The
consolidation of Huatai P&C contributed 2.2 percentage points
and 7.5 percentage points to Global P&C and Overseas General
net premiums written growth, respectively.
- Agriculture net premiums written declined 11.7%, primarily
reflecting the timing of premium recognition this year versus last
year. For the nine months, Agriculture net premiums written
increased 2.3%.
- P&C underwriting income in the quarter was $1.31 billion, up 83.8%, with a combined ratio of
88.4%. P&C current accident year underwriting income excluding
catastrophe losses was a record $1.78
billion, with a combined ratio of 84.3%.
- Global P&C underwriting income, which excludes Agriculture,
was $1.20 billion, up 117.2%, with a
combined ratio of 87.6%. Global P&C current accident year
underwriting income excluding catastrophe losses was a record
$1.66 billion, with a combined ratio
of 83.0%.
- Agriculture underwriting income was $105
million, with a combined ratio of 93.2% in the quarter,
bringing the year-to-date combined ratio to 91.7%. The combined
ratio in the quarter increased 2.6 percentage points, as the
company trued up its loss estimates to reflect its projected profit
and loss for the current crop year. Estimated development for the
current crop year was recognized this quarter compared to the
fourth quarter in the prior year.
- Life Insurance net premiums written increased 14.9%.
International life insurance net premiums written were $1.21 billion, up 19.7%. Life Insurance segment
income was $288 million. The
consolidation of Huatai Life contributed 14.8 percentage points
growth to International Life net premiums written.
- Pre-tax net investment income in the quarter was $1.31 billion, up 34.2%, and adjusted net
investment income was $1.41 billion,
up 34.2%. Both were records.
- Annualized return on equity (ROE) was 15.5% and annualized core
operating ROE was 13.5%. Annualized core operating return on
tangible equity (ROTE) was 21.2%.
Effective July 1, 2023, the
company increased its aggregate ownership interest in Huatai Group
(Huatai) to 69.6% and applied consolidation accounting beginning in
the third quarter. In this release, business activity for, and the
financial position of, Huatai is reported at 100%, as required,
except for core operating income, net income, book value, tangible
book value, ROE, per share data, and certain other key metrics,
which include only the company's ownership interest and exclude the
non-controlling interest. For a summary of the financial impact of
Huatai, refer to page 37 in the Q3 2023 Chubb Limited Financial
Supplement.
ZURICH, Oct. 24,
2023 /PRNewswire/ -- Chubb Limited (NYSE: CB)
today reported net income and core operating income for the quarter
ended September 30, 2023 of
$2.04 billion each, or $4.95 per share. Book value per share and
tangible book value per share decreased 0.3% and 10.2%,
respectively, from June 30, 2023, and
now stand at $128.37 and $70.89, respectively. Book value benefited from a
one-time after-tax net realized and unrealized gain of $727 million, principally reflecting the
discontinuation of the equity method of accounting upon the
consolidation of Huatai. Book value was unfavorably impacted by
after-tax net realized and unrealized losses of $2.18 billion in the company's investment
portfolio, principally due to the mark-to-market impact of rising
interest rates in the fixed income portfolio. In addition, tangible
book value included the adverse impact of $3.17 billion after-tax for Chubb's portion of
goodwill and other intangible assets related to the consolidation
of Huatai. Book value per share and tangible book value per
share excluding AOCI increased 2.6% and decreased 4.2%,
respectively, from June 30, 2023.
Chubb
Limited
Third Quarter
Summary
(in millions of U.S.
dollars, except per share amounts and ratios)
(Unaudited)
|
|
|
|
As
Adjusted
|
|
|
|
As
Adjusted
|
|
|
|
|
|
|
(Per
Share)
|
|
2023
|
2022
|
Change
|
|
2023
|
2022
|
Change
|
Net income
|
$2,043
|
$792
|
157.8 %
|
|
$4.95
|
$1.89
|
161.9 %
|
Cigna integration
expenses and other, net of tax
|
12
|
17
|
(29.4) %
|
|
0.02
|
0.04
|
(50.0) %
|
Adjusted net realized
(gains) losses, net of tax
|
(46)
|
574
|
NM
|
|
(0.10)
|
1.37
|
NM
|
Market risk benefits
(gains) losses, net of tax
|
32
|
(69)
|
NM
|
|
0.08
|
(0.17)
|
NM
|
Core operating income,
net of tax
|
$2,041
|
$1,314
|
55.4 %
|
|
$4.95
|
$3.13
|
58.1 %
|
|
|
|
|
|
|
|
|
Annualized return on
equity (ROE)
|
15.5 %
|
6.4 %
|
|
|
|
|
|
Core operating return
on tangible equity (ROTE)
|
21.2 %
|
14.1 %
|
|
|
|
|
|
Core operating
ROE
|
13.5 %
|
9.2 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
"As Adjusted":
Financial data for 2022 is adjusted, as applicable, and presented
in accordance with the LDTI U.S. GAAP guidance adopted on
1/1/2023. Refer to page 8 for additional
information.
|
For the nine months ended September 30,
2023, net income was $5.73
billion, or $13.79 per share,
and core operating income was $5.93
billion, or $14.27 per share.
Book value per share increased 5.4% and tangible book value per
share decreased 2.2% from December 31,
2022. Book value was unfavorably impacted by after-tax net
realized and unrealized losses of $1.7
billion in the company's investment portfolio. In addition,
tangible book value included the adverse impact of $3.17 billion after tax for Chubb's portion of
goodwill and other intangible assets related to the consolidation
of Huatai. Book value per share and tangible book value per
share excluding AOCI increased 7.0% and increased 2.0%,
respectively, from December 31,
2022.
Chubb
Limited
Nine Months Ended
Summary
(in millions of U.S.
dollars, except per share amounts and ratios)
(Unaudited)
|
|
|
|
As
Adjusted
|
|
|
|
As
Adjusted
|
|
|
|
|
|
|
(Per
Share)
|
|
2023
|
2022
|
Change
|
|
2023
|
2022
|
Change
|
Net income
|
$5,728
|
$3,935
|
45.5 %
|
|
$13.79
|
$9.26
|
48.9 %
|
Cigna integration
expenses and other, net of tax
|
42
|
33
|
27.3 %
|
|
0.10
|
0.08
|
25.0 %
|
Adjusted net realized
(gains) losses, net of tax
|
3
|
872
|
NM
|
|
0.01
|
2.05
|
NM
|
Market risk benefits
(gains) losses, net of tax
|
154
|
(85)
|
NM
|
|
0.37
|
(0.20)
|
NM
|
Core operating income,
net of tax
|
$5,927
|
$4,755
|
24.7 %
|
|
$14.27
|
$11.19
|
27.5 %
|
|
|
|
|
|
|
|
|
Annualized return on
equity (ROE)
|
14.8 %
|
9.9 %
|
|
|
|
|
|
Core operating return
on tangible equity (ROTE)
|
21.1 %
|
17.1 %
|
|
|
|
|
|
Core operating
ROE
|
13.3 %
|
11.1 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the nine months ended September
30, 2023 and 2022, the tax expenses (benefits)
related to the table above were $(164)
million and $(110) million,
respectively, for adjusted net realized gains and losses; and
$1.36 billion and $1.03 billion, respectively, for core operating
income.
Evan G. Greenberg, Chairman and
Chief Executive Officer of Chubb Limited, commented: "We had
another outstanding quarter which contributed to a record nine
months. Our performance in the quarter included double-digit Global
P&C premium revenue growth, world-class P&C underwriting
results, record net investment income, and strong life operating
income. Over $2 billion of core
operating income led to per-share earnings growth of 58.1% for the
quarter and 27.5% for the year. Annualized core operating ROE was
13.5%, with a return on tangible equity of 21.2%. In the quarter,
we increased our ownership in Huatai Group, now at 72%, and
consolidated results, which were accretive to EPS and ROE.
"P&C underwriting income of $1.3
billion this quarter was up almost 84%. Our underwriting
results were driven by strong P&C earned premium growth,
excellent current accident year underwriting margins inclusive of
catastrophe losses, and favorable prior period reserve development
in both North America and Overseas
General. The published calendar year combined ratio was 88.4% while
the Global P&C current accident year combined ratio excluding
CATs was 83%.
"Adjusted net investment income of $1.4
billion was up $361 million,
or 34%, over prior year. Our investment income continues to grow
quickly as we reinvest our strong cash flow at higher rates and
compound income in our predominantly fixed-income, relatively
short-duration portfolio. Our operating cash flow this quarter was
a record $4.7 billion.
"Global P&C premium growth was 12.3%, with commercial lines
up 10.3% and consumer lines up 17.6%. In North America commercial, property and
casualty premiums were up 10.5% while financial lines were up 1%.
Our very large U.S. middle market business had its best growth of
the year at 16.3%. Our market-leading high-net-worth personal lines
business had another outstanding quarter with growth of 9.6%. Our
Overseas General division had a great quarter with premiums up
21.4%, including double-digit growth in Europe, Asia
Pacific, and Latin America.
Huatai contributed 7.5 percentage points to Overseas General's
growth. In our Asia-focused
international life business, premiums were up nearly 20%, including
the impact of Huatai.
"In aggregate, rates and price increases in our commercial
P&C lines of business remained strong in the quarter globally.
Pricing was up 13.9% in North
America and 11.7% in our international business. Financial
lines pricing was down in North
America and up modestly overseas. In North America and Overseas General, P&C
pricing exceeded loss cost trends, which were stable in the
quarter. We are vigilant and disciplined and are staying on top of
loss cost inflation.
"We are confident in our ability to continue growing revenue and
operating earnings, which in turn drive EPS, through the three
engines of P&C underwriting income, investment income, and life
income."
Operating highlights for the quarter ended September 30, 2023 were as follows:
|
|
|
|
|
|
As
Adjusted
|
|
Chubb
Limited
|
Q3
|
Q3
|
|
(in millions of U.S.
dollars except for percentages)
|
2023
|
2022
|
Change
|
Consolidated
|
|
|
|
|
|
Net premiums written
(increase of 8.4% in constant dollars)
|
$
|
13,104
|
$
|
12,012
|
9.1 %
|
|
|
|
|
|
|
P&C
|
|
|
|
|
|
Net premiums written
(increase of 7.6% in constant dollars)
|
$
|
11,652
|
$
|
10,747
|
8.4 %
|
Underwriting
income
|
$
|
1,305
|
$
|
710
|
83.8 %
|
Combined
ratio
|
|
88.4 %
|
|
93.1 %
|
|
Current accident year
underwriting income excluding catastrophe losses
|
$
|
1,775
|
$
|
1,646
|
7.8 %
|
Current accident year
combined ratio excluding catastrophe losses
|
|
84.3 %
|
|
84.0 %
|
|
|
|
|
|
|
|
Global P&C
(excludes Agriculture)
|
|
|
|
|
|
Net premiums written
(increase of 11.2% in constant dollars)
|
$
|
10,131
|
$
|
9,024
|
12.3 %
|
Underwriting
income
|
$
|
1,200
|
$
|
552
|
117.2 %
|
Combined
ratio
|
|
87.6 %
|
|
93.6 %
|
|
Current accident year
underwriting income excluding catastrophe losses
|
$
|
1,661
|
$
|
1,448
|
14.6 %
|
Current accident year
combined ratio excluding catastrophe losses
|
|
83.0 %
|
|
83.2 %
|
|
Life
Insurance
|
|
|
|
|
|
Net premiums written
(increase of 15.2% in constant dollars)
|
$
|
1,452
|
$
|
1,265
|
14.9 %
|
Segment income
(increase of 14.7% in constant dollars)
|
$
|
288
|
$
|
252
|
14.8 %
|
- Consolidated net premiums earned increased 9.9%, or 9.0% in
constant dollars. P&C net premiums earned increased 9.2%, or
8.1% in constant dollars.
- Operating cash flow was a record $4.68
billion for the quarter.
- Total pre-tax and after-tax P&C catastrophe losses, net of
reinsurance and including reinstatement premiums, were $670 million (6.0 percentage points of the
combined ratio) and $544 million,
respectively, compared with $1.16
billion (11.3 percentage points of the combined ratio) and
$949 million, respectively, last
year.
- Total pre-tax and after-tax favorable prior period development
were $200 million and $116 million, respectively, compared with
$222 million and $162 million, respectively, last year.
- Total capital returned to shareholders in the quarter was
$958 million, including share
repurchases of $606 million at an
average purchase price of $205.44 per
share, and dividends of $352
million.
- On October 1, 2023, the company
increased its ownership in Huatai with the closing of an
incremental 2.5% interest, bringing its total aggregate interest in
Huatai to 72.1%. The company expects the ownership to increase
further during the fourth quarter.
- In the third quarter, Huatai contributed 2.9 percentage points
to consolidated net premiums written growth. Huatai was accretive
to third quarter 2023 results as follows: $0.12, or 2.5%, to core operating income per
share; 1.3 percentage points to book value per share and 0.3
percentage points to core operating return on equity.
- On July 1, 2023, the
consolidation of Huatai added $5.05
billion pre-tax to goodwill and other intangible assets, of
which $3.52 billion pre-tax, or
$3.23 billion after tax, is
attributable to Chubb which resulted in dilution of tangible book
value per share excluding AOCI of 7.5 percentage points. The
company expects to earn back goodwill and other intangible assets
in less than five months.
Details of financial results by business segment are available
in the Chubb Limited Financial Supplement. Key segment items for
the quarter ended September 30, 2023
are presented below:
|
|
As
Adjusted
|
|
|
Chubb
Limited
|
Q3
|
Q3
|
|
|
(in millions of U.S.
dollars except for percentages)
|
2023
|
2022
|
Change
|
|
|
|
|
|
|
|
|
Total North
America P&C Insurance
|
|
|
|
|
|
|
(Comprising NA
Commercial P&C Insurance, NA Personal P&C Insurance and NA
Agricultural Insurance)
Net premiums
written
|
$
|
8,180
|
$
|
7,837
|
4.4 %
|
|
Combined
ratio
|
|
87.1 %
|
|
90.7 %
|
|
|
Current accident year
combined ratio excluding catastrophe losses
|
|
83.0 %
|
|
82.4 %
|
|
|
|
|
|
|
|
|
|
North America
Commercial P&C Insurance
|
|
|
|
|
|
|
Net premiums
written
|
$
|
5,132
|
$
|
4,722
|
8.7 %
|
|
Major accounts retail
and excess and surplus (E&S) wholesale
|
$
|
3,075
|
$
|
2,869
|
7.2 %
|
|
Middle market and
small commercial
|
$
|
2,057
|
$
|
1,853
|
11.0 %
|
|
Combined
ratio
|
|
84.2 %
|
|
90.9 %
|
|
|
Current accident
year combined ratio excluding catastrophe losses
|
|
81.1 %
|
|
81.1 %
|
|
|
|
|
|
|
|
|
|
North America
Personal P&C Insurance
|
|
|
|
|
|
|
Net premiums
written
|
$
|
1,527
|
$
|
1,392
|
9.6 %
|
|
Combined
ratio
|
|
90.3 %
|
|
90.1 %
|
|
|
Current accident
year combined ratio excluding catastrophe losses
|
|
78.9 %
|
|
79.5 %
|
|
|
|
|
|
|
|
|
|
North America
Agricultural Insurance
|
|
|
|
|
|
|
Net premiums
written
|
$
|
1,521
|
$
|
1,723
|
(11.7) %
|
|
Combined
ratio
|
|
93.2 %
|
|
90.6 %
|
|
|
Current accident year
combined ratio excluding catastrophe losses
|
|
92.7 %
|
|
88.2 %
|
|
|
|
|
|
|
|
|
|
Overseas General
Insurance
|
|
|
|
|
|
|
Net premiums written
(increase of 17.3% in constant dollars)
|
$
|
3,211
|
$
|
2,645
|
21.4 %
|
|
Commercial P&C
(increase of 14.6% in constant dollars)
|
$
|
1,901
|
$
|
1,625
|
17.0 %
|
|
Consumer P&C
(increase of 21.4% in constant dollars)
|
$
|
1,310
|
$
|
1,020
|
28.4 %
|
|
Combined
ratio
|
|
87.0 %
|
|
88.5 %
|
|
|
Current accident year
combined ratio excluding catastrophe losses
|
|
84.8 %
|
|
85.1 %
|
|
|
|
|
|
|
|
|
|
Life
Insurance
|
|
|
|
|
|
|
Net premiums written
(increase of 15.2% in constant dollars)
|
$
|
1,452
|
$
|
1,265
|
14.9 %
|
|
Segment income
(increase of 14.7% in constant dollars)
|
$
|
288
|
$
|
252
|
14.8 %
|
|
|
|
|
|
|
|
|
- North America Commercial P&C Insurance: Net premiums
written increased 8.7% with P&C lines up 10.5% and financial
lines were up 1.1%. The combined ratio decreased 6.7 percentage
points, primarily reflecting lower catastrophe losses. The current
accident year combined ratio excluding catastrophe losses was flat
year-over-year, reflecting a 0.4 percentage point decrease in the
loss ratio and a 0.4 percentage point increase in the expense ratio
primarily from higher pension expenses reflecting financial market
conditions at the time of valuation late in 2022.
- North America Personal P&C Insurance: The combined ratio
increased 0.2 percentage points, primarily reflecting higher
catastrophe losses and lower favorable prior period development.
The current accident year combined ratio excluding catastrophe
losses decreased 0.6 percentage point, including a 1.2 percentage
point decrease in the loss ratio and a 0.6 percentage point
increase in the expense ratio. The increase in the expense ratio is
primarily from higher pension expenses as noted above.
- Overseas General Insurance: The combined ratio decreased 1.5
percentage points reflecting higher favorable prior period
development in the quarter. The current accident year combined
ratio excluding catastrophe losses decreased 0.3 percentage point,
including a 1.1 percentage point decrease in the expense ratio and
a 0.8 percentage point increase in the loss ratio in part from both
mix of business and higher losses in automobile.
- Life Insurance: Segment income was $288
million, up 14.8%, including earnings from Huatai and higher
net investment income.
All comparisons are with the same period last year unless
otherwise specifically stated. Please refer to the Chubb
Limited Financial Supplement, dated September 30, 2023, which
is posted on the company's investor relations website,
investors.chubb.com, in the Financials section for more detailed
information on individual segment performance, together with
additional disclosure on reinsurance recoverable, loss reserves,
investment portfolio, and debt and capital.
Chubb Limited will hold its third quarter earnings conference
call on Wednesday, October 25, 2023
beginning at 8:30 a.m. Eastern. The
earnings conference call will be available via live webcast at
investors.chubb.com or by dialing 877-400-4403 (within
the United States) or 332-251-2601
(international), passcode 1641662. Please refer to the Chubb
website under Events and Presentations for details. A replay will
be available after the call at the same location. To listen to the
replay, please click here to register and receive dial-in
numbers.
"As Adjusted": Effective January 1,
2023, the company adopted the Long-Duration Targeted
Improvements (LDTI) U.S. GAAP guidance, which principally impacted
the Life Insurance segment. LDTI requires more frequent updating of
assumptions and a standardized discount rate for long-duration
contracts, a requirement to use the fair value measurement model
for policies with market risk benefits, and amortization of
deferred acquisition costs on a constant level basis. Under LDTI,
the company's reinsurance programs covering variable annuity
guarantees (principally guaranteed minimum death benefits and
guaranteed minimum income benefits) meet the definition of
market-risk benefits (MRB) and are measured at fair value and are
now reported within "Market risk benefits" in the financial
statements. The impact to 2022 results was immaterial.
About Chubb
Chubb is the world's largest publicly
traded property and casualty insurance company. With operations in
54 countries and territories, Chubb provides commercial and
personal property and casualty insurance, personal accident and
supplemental health insurance, reinsurance and life insurance to a
diverse group of clients. As an underwriting company, we assess,
assume and manage risk with insight and discipline. We service and
pay our claims fairly and promptly. The company is also defined by
its extensive product and service offerings, broad distribution
capabilities, exceptional financial strength and local operations
globally. Parent company Chubb Limited is listed on the New York
Stock Exchange (NYSE: CB) and is a component of the S&P 500
index. Chubb maintains executive offices in Zurich, New
York, London, Paris and other locations, and employs
approximately 40,000 people worldwide. Additional information can
be found at: www.chubb.com.
Regulation G – Non-GAAP Financial Measures
In presenting our results, we included and discussed certain
non-GAAP measures. These non-GAAP measures, which may be defined
differently by other companies, are important for an understanding
of our overall results of operations and financial condition.
However, they should not be viewed as a substitute for measures
determined in accordance with generally accepted accounting
principles (GAAP).
Throughout this document there are various measures presented on
a constant-dollar basis (i.e., excludes the impact of foreign
exchange). We believe it is useful to evaluate the trends in our
results exclusive of the effect of fluctuations in exchange rates
between the U.S. dollar and the currencies in which our
international business is transacted, as these exchange rates could
fluctuate significantly between periods and distort the analysis of
trends. The impact is determined by assuming constant foreign
exchange rates between periods by translating prior period results
using the same local currency exchange rates as the comparable
current period.
Adjusted net investment income is net investment income
excluding the amortization of the fair value adjustment on acquired
invested assets from certain acquisitions of $9 million and $6
million in Q3 2023 and Q3 2022, respectively, and including
investment income of $92 million and
$69 million in Q3 2023 and Q3 2022,
respectively, from partially owned investment companies (private
equity partnerships) where our ownership interest is in excess of
3% that are accounted for under the equity method. The amortization
of the fair value adjustment on acquired invested assets was
$14 million and $36 million for the nine months ended
September 30, 2023 and 2022,
respectively, and the investment income from private equity
partnerships was $276 million and
$180 million for the nine months
ended September 30, 2023 and 2022,
respectively. The mark-to-market movement on these private equity
partnerships are included in adjusted net realized gains (losses)
as described below. We believe this measure is meaningful as it
highlights the underlying performance of our invested assets and
portfolio management in support of our lines of business.
Adjusted net realized gains (losses), net of tax, includes
net realized gains (losses) and net realized gains (losses)
recorded in other income (expense) related to unconsolidated
subsidiaries, and excludes realized gains and losses on crop
derivatives. These derivatives were purchased to provide economic
benefit, in a manner similar to reinsurance protection, in the
event that a significant decline in commodity pricing impacts
underwriting results. We view gains and losses on these derivatives
as part of the results of our underwriting operations, and
therefore realized gains (losses) from these derivatives are
reclassified to adjusted losses and loss expenses.
P&C underwriting income is calculated by subtracting
adjusted losses and loss expenses, adjusted policy benefits, policy
acquisition costs and administrative expenses from net premiums
earned by our P&C operations. We use underwriting income (loss)
and operating ratios to monitor the results of our operations
without the impact of certain factors, including net investment
income, other income (expense), interest expense, amortization
expense of purchased intangibles, income tax expense and adjusted
net realized gains (losses).
P&C current accident year underwriting income excluding
catastrophe losses is P&C underwriting income adjusted to
exclude catastrophe losses and prior period development (PPD). We
believe it is useful to exclude catastrophe losses, as they are not
predictable as to timing and amount, and PPD as these unexpected
loss developments on historical reserves are not indicative of our
current underwriting performance. We believe the use of these
measures enhances the understanding of our results of operations by
highlighting the underlying profitability of our insurance
business.
Core operating income, net of tax, relates only to Chubb income,
which excludes noncontrolling interests. It excludes from Chubb net
income attributable to Chubb the after-tax impact of adjusted net
realized gains (losses), market risk benefit gains (losses), Cigna
integration expenses, the amortization of fair value adjustment of
acquired invested assets and long-term debt related to certain
acquisitions. We believe this presentation enhances the
understanding of our results of operations by highlighting the
underlying profitability of our insurance business. We exclude
adjusted net realized gains (losses) because the amount of these
gains (losses) are heavily influenced by, and fluctuate in part
according to, the availability of market opportunities. We exclude
the amortization of fair value adjustments on purchased invested
assets and long-term debt related to certain acquisitions due to
the size and complexity of these acquisitions. We also exclude
Cigna integration expenses, which are incurred by the overall
company and are included in Corporate. These expenses include legal
and professional fees and all other costs directly related to the
integration activities of the Cigna acquisition. The costs are not
related to the on-going activities of the individual segments and
are therefore also excluded from our definition of segment income.
We believe these integration expenses are not indicative of our
underlying profitability, and excluding these integration expenses
facilitates the comparison of our financial results to our
historical operating results. References to core operating income
measures mean net of tax, whether or not noted.
Core operating return on equity (ROE) and Core operating
return on tangible equity (ROTE) are annualized non-GAAP financial
measures. The numerator includes core operating income (loss), net
of tax. The denominator includes the average Chubb shareholders'
equity for the period adjusted to exclude unrealized gains (losses)
on investments, current discount rate on future policy benefits
(FPB), and instrument-specific credit risk on MRB, net of tax. For
the ROTE calculation, the denominator is also adjusted to exclude
Chubb goodwill and other intangible assets, net of tax. These
measures enhance the understanding of the return on shareholders'
equity by highlighting the underlying profitability relative to
shareholders' equity and tangible equity excluding the effect of
unrealized gains and losses on our investments that are heavily
influenced by available market opportunities. We believe ROTE is
meaningful because it measures the performance of our operations
without the impact of goodwill and other intangible assets.
P&C combined ratio is the sum of the loss and loss
expense ratio, acquisition cost ratio and the administrative
expense ratio excluding the life business and including the
realized gains and losses on the crop derivatives, as noted
above.
P&C current accident year combined ratio excluding
catastrophe losses excludes the impact of P&C catastrophe
losses and PPD from the P&C combined ratio. We believe this
measure provides a better evaluation of our underwriting
performance and enhances the understanding of the trends in our
property and casualty business that may be obscured by these
items.
Global P&C performance metrics comprise consolidated
operating results (including corporate) and exclude the operating
results of the company's Life Insurance and North America
Agricultural Insurance segments. The agriculture insurance business
is a different business in that it is a public sector and private
sector partnership in which insurance rates, premium growth, and
risk-sharing is not market-driven like the remainder of the
company's P&C insurance business. We believe that these
measures are useful and meaningful to investors as they are used by
management to assess the company's global P&C operations which
are the most economically similar. We exclude the North America
Agricultural Insurance and Life Insurance segments because the
results of these businesses do not always correlate with the
results of our global P&C operations.
Tangible book value per common share is Chubb shareholders'
equity less goodwill and other intangible assets, net of tax,
divided by the shares outstanding. We believe that goodwill and
other intangible assets are not indicative of our underlying
insurance results or trends and make book value comparisons to less
acquisitive peer companies less meaningful.
Book value per share and tangible book value per share excluding
accumulated other comprehensive income (loss) (AOCI), excludes AOCI
from the numerator because it eliminates the effect of items that
can fluctuate significantly from period to period, primarily based
on changes in interest rates and foreign currency movement, to
highlight underlying growth in book and tangible book value.
See the reconciliation of Non-GAAP Financial Measures on pages
29-35 in the Financial Supplement. These measures should not be
viewed as a substitute for measures determined in accordance with
GAAP, including premium, net income, book value, return on equity,
and net investment income.
NM – not meaningful comparison
Cautionary Statement Regarding Forward-Looking
Statements:
Forward-looking statements made in this press release, such
as those related to company performance, pricing, growth
opportunities, economic and market conditions, the timing of Huatai
ownership increases, and our expectations and intentions and other
statements that are not historical facts, reflect our current views
with respect to future events and financial performance and are
made pursuant to the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995. Such statements involve
risks and uncertainties that could cause actual results to differ
materially, including without limitation, the following:
competition, pricing and policy term trends, the levels of new and
renewal business achieved, the frequency and severity of
unpredictable catastrophic events, actual loss experience,
uncertainties in the reserving or settlement process, integration
activities and performance of acquired companies, loss of key
employees or disruptions to our operations, new theories of
liability, judicial, legislative, regulatory and other governmental
developments, litigation tactics and developments, investigation
developments and actual settlement terms, the amount and timing of
reinsurance recoverable, credit developments among reinsurers,
rating agency action, infection rates and severity of pandemics,
including COVID-19, and their effects on our business operations
and claims activity, possible terrorism or the outbreak and effects
of war, economic, political, regulatory, insurance and reinsurance
business conditions, potential strategic opportunities including
acquisitions and our ability to achieve and integrate them, as well
as management's response to these factors, and other factors
identified in our filings with the Securities and Exchange
Commission (SEC). Readers are cautioned not to place undue reliance
on these forward-looking statements, which speak only as of the
dates on which they are made. We undertake no obligation to
publicly update or revise any forward-looking statements, whether
as a result of new information, future events or otherwise.
Chubb
Limited
|
Summary Consolidated
Balance Sheets
|
(in millions of U.S.
dollars, except per share data)
|
(Unaudited)
|
|
|
|
|
As
Adjusted
|
|
September
30
2023
|
|
December
31
2022
|
Assets
|
|
|
|
Investments
|
$
|
129,961
|
|
$
|
113,551
|
Cash
|
2,586
|
|
2,012
|
Insurance and
reinsurance balances receivable
|
13,907
|
|
11,933
|
Reinsurance recoverable
on losses and loss expenses
|
19,750
|
|
18,859
|
Goodwill and other
intangible assets ($24,900 represents Chubb portion as of
9/30/2023)
|
26,398
|
|
21,669
|
Other assets
|
30,146
|
|
30,993
|
|
Total assets
|
$
|
222,748
|
|
$
|
199,017
|
|
|
|
|
|
Liabilities
|
|
|
|
Unpaid losses and loss
expenses
|
$
|
79,705
|
|
$
|
75,747
|
Unearned
premiums
|
22,684
|
|
19,713
|
Other
liabilities
|
62,855
|
|
53,038
|
|
Total
liabilities
|
|
165,244
|
|
|
148,498
|
|
|
|
|
|
Shareholders'
equity
|
|
|
|
Chubb shareholders'
equity, excl. AOCI
|
63,891
|
|
60,704
|
Accumulated other
comprehensive income (loss) (AOCI)
|
(11,518)
|
|
(10,185)
|
|
Chubb shareholders'
equity
|
52,373
|
|
50,519
|
Noncontrolling
interests
|
5,131
|
|
-
|
|
Total shareholders'
equity
|
57,504
|
|
50,519
|
|
Total liabilities and
shareholders' equity
|
$
|
222,748
|
|
$
|
199,017
|
|
|
|
|
|
Book value per common
share
|
$
|
128.37
|
|
$
|
121.85
|
Tangible book value per
common share
|
$
|
70.89
|
|
$
|
72.51
|
Book value per common
share, excl. AOCI
|
|
$
|
156.60
|
|
$
|
146.42
|
Tangible book value per
common share, excl. AOCI
|
|
$
|
96.83
|
|
$
|
94.90
|
|
Chubb
Limited
|
Summary Consolidated
Financial Data
|
(in millions of U.S.
dollars, except share, per share data, and ratios)
|
(Unaudited)
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
September
30
|
|
September
30
|
|
|
|
As
Adjusted
|
|
|
|
As
Adjusted
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
Gross premiums
written
|
$
|
15,996
|
|
$
|
15,006
|
|
$
|
43,880
|
|
$
|
39,538
|
Net premiums
written
|
13,104
|
|
12,012
|
|
35,765
|
|
31,494
|
Net premiums
earned
|
12,674
|
|
11,530
|
|
33,815
|
|
29,816
|
Losses and loss
expenses
|
7,106
|
|
7,063
|
|
17,937
|
|
16,833
|
Policy
benefits
|
938
|
|
707
|
|
2,565
|
|
1,441
|
Policy acquisition
costs
|
2,178
|
|
1,970
|
|
6,142
|
|
5,415
|
Administrative
expenses
|
1,060
|
|
883
|
|
2,959
|
|
2,479
|
Net investment
income
|
1,314
|
|
979
|
|
3,566
|
|
2,689
|
Net realized gains
(losses)
|
(103)
|
|
(456)
|
|
(484)
|
|
(936)
|
Market risk benefits
gains (losses)
|
(32)
|
|
69
|
|
(154)
|
|
85
|
Interest
expense
|
174
|
|
150
|
|
499
|
|
416
|
Other income
(expense):
|
|
|
|
|
|
|
|
|
Gains (losses) from
separate account assets
|
(19)
|
|
(67)
|
|
(56)
|
|
(116)
|
|
Other
|
173
|
|
(135)
|
|
606
|
|
125
|
Amortization of
purchased intangibles
|
84
|
|
69
|
|
226
|
|
211
|
Cigna integration
expenses
|
14
|
|
23
|
|
51
|
|
26
|
Income tax
expense
|
413
|
|
263
|
|
1,189
|
|
907
|
Net income
|
$
|
2,040
|
|
$
|
792
|
|
$
|
5,725
|
|
$
|
3,935
|
Less: noncontrolling
interests income
|
(3)
|
|
-
|
|
(3)
|
|
-
|
Chubb net
income
|
$
|
2,043
|
|
$
|
792
|
|
$
|
5,728
|
|
$
|
3,935
|
|
|
|
|
|
|
|
|
|
Diluted earnings per
share:
|
|
|
|
|
|
|
|
Chubb net
income
|
$
|
4.95
|
|
$
|
1.89
|
|
$
|
13.79
|
|
$
|
9.26
|
Core operating
income
|
$
|
4.95
|
|
$
|
3.13
|
|
$
|
14.27
|
|
$
|
11.19
|
|
|
|
|
|
|
|
|
|
Weighted average shares
outstanding
|
412.6
|
|
419.6
|
|
415.4
|
|
425.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
P&C combined
ratio
|
|
|
|
|
|
|
|
Loss and loss expense
ratio
|
64.0 %
|
|
69.6 %
|
|
60.9 %
|
|
62.0 %
|
Policy acquisition cost
ratio
|
16.9 %
|
|
16.6 %
|
|
17.8 %
|
|
17.7 %
|
Administrative expense
ratio
|
7.5 %
|
|
6.9 %
|
|
8.1 %
|
|
7.8 %
|
P&C combined
ratio
|
88.4 %
|
|
93.1 %
|
|
86.8 %
|
|
87.5 %
|
|
|
|
|
|
|
|
|
|
P&C underwriting
income
|
$
|
1,305
|
|
$
|
710
|
|
$
|
3,943
|
|
$
|
3,434
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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SOURCE Chubb Limited