Chubb's Third-Quarter Core Earnings Fell 2.2% On Storm Losses, While Nine-Month Profit Set Records
Catastrophe losses rose to $705 million from $285 million, pushing the combined ratio to 84.1%, though nine-month income was a record.
Chubb's core operating income slipped 2.2% in the third quarter to $2.98 billion, or $7.66 per share, as storm losses climbed, according to results furnished in an 8-K. Per-share core earnings still rose 0.8%, and nine-month income reached a record.
What the results show
Net income was $2.84 billion, or $7.30 per share, up 1.5% in total and 4.4% per share. Core operating income of $2.98 billion compared with $3.05 billion a year earlier on the same redefined basis, which now excludes amortization of most purchased intangibles.
The property and casualty combined ratio, where lower means more underwriting profit, was 84.1% versus 81.8% a year earlier. Pre-tax catastrophe losses were $705 million versus $285 million. Favorable development on prior-year reserves was $511 million versus $361 million.
Excluding catastrophes and reserve development, the current-accident-year combined ratio was 82.6% versus 82.5%. Net premiums written rose 1.9% to $15.1 billion.
For the first nine months, core operating income was a record $8.60 billion, or $21.94 per share, up 21.0% and 24.5%. Net income was a record $8.02 billion, or $20.46 per share.
What it changes for holders
Chairman and CEO Evan G. Greenberg blamed the comparison: "Due to particularly light CAT losses last year, earnings are down 2% and up 1% per share from 2025." He called the nine-month figures "a more meaningful perspective."
Book value per share fell 2.1% from June 30 to $191.43, as after-tax investment portfolio losses of $4.48 billion in the quarter were partly offset by $551 million of currency gains. Tangible book value per share excluding accumulated other comprehensive income, which strips out interest-rate marks, rose 15.4% from a year earlier.
North America Commercial premiums fell 2.7%, or rose 1.7% excluding large-account property and financial lines changes. Overseas General grew 6.7%, North America Personal 5.3% and Agriculture 5.1%. Greenberg said he fully expects North America commercial growth to improve in coming quarters.
Chubb returned $1.57 billion to shareholders in the quarter: $1.18 billion of buybacks at an average $344.32 per share and $393 million of dividends. Shares closed at $357.75 on Tuesday, up 0.42%, before the release.
What to watch
Chubb holds its third-quarter earnings call on Wednesday at 8:30 a.m. Eastern.
Greenberg also said Chubb's holding partnership with KKR agreed to sell its USI Insurance Services stake to Aon, expected to bring a realized gain of $460 million on a $740 million investment.
Sources
- 8-K Filing — Chubb Ltd (CB) — SEC EDGAR
- Exhibit d160822dex991.htm — Chubb Ltd 8-K exhibit — SEC EDGAR
- Exhibit d160822dex992.htm — Chubb Ltd 8-K exhibit — SEC EDGAR
- Chubb (CB) Q3 Earnings Report Preview: What To Look For — Yahoo Finance
- Chubb Reports Third Quarter Per Share Net Income and Record Core Operating Income of $7.30 and $7.66, Respectively, Up 4.4% and 0.8%; Consolidated Net Premiums Written of $15.1 Billion, Up 1.9%, with P&C and Life Insurance Up 1.9% and 1.4%; P&C Combined Ratio of 84.1%; Record Year-to-Date Per Share Net Income and Core Operating Income of $20.46 and $21.94, Up 16.2% and 24.5%, Respectively; Annualized Return on Equity (ROE) of 14.5% and Core Operating ROE of 14.6% – Company Announcement - FT.com — Financial Times
- Chubb news, trends and insights - Insurance Journal — insurancejournal.com
