EX-99.2 3 y96635exv99w2.htm EX-99.2: SUPPLEMENTARY INVESTOR INFORMATION REPORT EX-99.2: SUPPLEMENTARY INVESTOR INFORMATION REPORT
 

Exhibit 99.2

         
The
  Supplementary   March 31, 2004
Chubb
  Investor    
Corporation
  Information    
     
This report is for informational purposes only. It should be read in conjunction with documents filed by
   
The Chubb Corporation with the Securities and Exchange Commission, including the most recent
   
Annual Report on Form 10-K and Quarterly Reports on Form 10-Q.
  (CHUBB LOGO)

 


 

THE CHUBB CORPORATION
SUPPLEMENTARY INVESTOR INFORMATION
TABLE OF CONTENTS
MARCH 31, 2004

         
    Page
The Chubb Corporation:
       
Consolidated Balance Sheet Highlights
    1  
Summary of Invested Assets:
       
Corporate
    2  
Property and Casualty
    2  
Investment Income After Taxes:
       
Corporate
    3  
Property and Casualty
    3  
Property and Casualty Insurance Group:
       
Statutory Policyholders’ Surplus
    3  
Change in Net Unpaid Losses
    4  
Underwriting Results — Quarterly
    5-8  
Definitions of Key Terms
    9  

 


 

THE CHUBB CORPORATION
CONSOLIDATED BALANCE SHEET HIGHLIGHTS

                 
    Mar. 31   Dec. 31
    2004
  2003
    (in millions)
Invested Assets (at carrying value)
               
Short Term Investments
  $ 2,040.9     $ 2,695.9  
Fixed Maturities
               
Tax Exempt
    12,722.4       11,621.0  
Taxable
    11,730.8       10,790.7  
Equity Securities
    1,731.8       1,514.4  
 
   
 
     
 
 
Total Invested Assets
  $ 28,225.9     $ 26,622.0  
 
   
 
     
 
 
Unrealized Appreciation of Fixed Maturities Carried at Amortized Cost
  $ 32.5     $ 35.2  
 
   
 
     
 
 
Capitalization
               
Long Term Debt
  $ 2,814.9     $ 2,813.9  
Shareholders’ Equity
    9,046.4       8,522.0  
 
   
 
     
 
 
Total Capitalization
  $ 11,861.3     $ 11,335.9  
 
   
 
     
 
 
DEBT AS A PERCENTAGE OF TOTAL CAPITALIZATION
    23.7 %     24.8 %
Actual Common Shares Outstanding
    189.7       188.0  
Book Value Per Common Share
  $ 47.69     $ 45.33  
Book Value Per Common Share, with Available-for-Sale Fixed Maturities at Amortized Cost
  $ 44.05     $ 42.21  

Page 1 of 9


 

THE CHUBB CORPORATION
SUMMARY OF INVESTED ASSETS

CORPORATE

                                                 
    Cost or   Market   Carrying
    Amortized Cost
  Value
  Value
    Mar. 31   Dec. 31   Mar. 31   Dec. 31   Mar. 31   Dec. 31
    2004
  2003
  2004
  2003
  2004
  2003
    (in millions)
Short Term Investments
  $ 791.1     $ 714.3     $ 791.1     $ 714.3     $ 791.1     $ 714.3  
Taxable Fixed Maturities
    428.5       433.1       436.5       436.4       436.5       436.4  
Equity Securities
    8.5       8.4       10.2       9.5       10.2       9.5  
 
   
 
     
 
     
 
     
 
     
 
     
 
 
TOTAL
  $ 1,228.1     $ 1,155.8     $ 1,237.8     $ 1,160.2     $ 1,237.8     $ 1,160.2  
 
   
 
     
 
     
 
     
 
     
 
     
 
 

PROPERTY AND CASUALTY

                                                 
    Cost or   Market   Carrying
    Amortized Cost
  Value
  Value
    Mar. 31   Dec. 31   Mar. 31   Dec. 31   Mar. 31   Dec. 31
    2004
  2003
  2004
  2003
  2004
  2003
    (in millions)
Short Term Investments
  $ 1,249.8     $ 1,981.6     $ 1,249.8     $ 1,981.6     $ 1,249.8     $ 1,981.6  
Fixed Maturities
                                               
Tax Exempt
    12,053.8       10,976.7       12,754.9       11,656.2       12,722.4       11,621.0  
Taxable
    10,909.8       10,098.7       11,294.3       10,354.3       11,294.3       10,354.3  
Common Stocks
    1,516.9       1,333.3       1,673.9       1,458.2       1,673.9       1,458.2  
Preferred Stocks
    39.6       39.7       47.7       46.7       47.7       46.7  
 
   
 
     
 
     
 
     
 
     
 
     
 
 
TOTAL
  $ 25,769.9     $ 24,430.0     $ 27,020.6     $ 25,497.0     $ 26,988.1     $ 25,461.8  
 
   
 
     
 
     
 
     
 
     
 
     
 
 

Page 2 of 9


 

THE CHUBB CORPORATION
INVESTMENT INCOME AFTER TAXES

                 
    THREE MONTHS ENDED
    MARCH 31
    2004
  2003
    (in millions)
CORPORATE INVESTMENT INCOME
  $ 7.2     $ 0.4  
 
   
 
     
 
 
PROPERTY AND CASUALTY INVESTMENT INCOME
               
(Amounts are shown net of applicable income taxes)
               
Dividends
  $ 6.6     $ 3.4  
Taxable Interest
    90.0       84.0  
Tax Exempt Interest
    129.3       115.3  
Investment Expenses
    (4.1 )     (4.7 )
 
   
 
     
 
 
TOTAL
  $ 221.8     $ 198.0  
 
   
 
     
 
 
Effective Tax Rate
    20.1 %     19.6 %
After Tax Annualized Yield
    3.51 %     3.95 %

After tax annualized yield is based on the average invested assets for the periods presented with fixed maturities at amortized cost and equity securities at market value.

STATUTORY POLICYHOLDERS’ SURPLUS

                         
    March 31   March 31   Dec. 31
    2004
  2003
  2003
    (in millions)
Estimated Statutory Policyholders’ Surplus
  $ 6,750     $ 4,850     $ 6,368  
Rolling Year Statutory Net Premiums Written
    11,415       9,514       11,071  
Ratio of Statutory Net Premiums Written to Policyholders’ Surplus
    1.69:1       1.96:1       1.74:1  

Statutory Policyholders’ Surplus and Net Premiums Written include all domestic and foreign property and casualty subsidiaries.

Page 3 of 9


 

THE CHUBB CORPORATION
PROPERTY AND CASUALTY
CHANGE IN NET UNPAID LOSSES
THREE MONTHS ENDED MARCH 31, 2004

                                         
    Net Unpaid Losses           All Other
   
          Unpaid Losses
                    Increase   IBNR   Increase
    3/31/04
  12/31/03
  (Decrease)
  Increase
  (Decrease)
    (in millions)
PERSONAL INSURANCE
                                       
Automobile
  $ 348.6     $ 342.6     $ 6.0     $ 3.7     $ 2.3  
Homeowners
    627.0       564.2       62.8       13.7       49.1  
Other
    328.2       312.0       16.2       25.9       (9.7 )
 
   
 
     
 
     
 
     
 
     
 
 
Total Personal
    1,303.8       1,218.8       85.0       43.3       41.7  
 
   
 
     
 
     
 
     
 
     
 
 
COMMERCIAL INSURANCE
                                       
Multiple Peril
    1,269.0       1,248.2       20.8       36.1       (15.3 )
Casualty
    3,954.1       3,922.6       31.5       62.1       (30.6 )
Workers’ Compensation
    943.0       890.9       52.1       38.1       14.0  
Property and Marine
    480.1       483.1       (3.0 )     15.8       (18.8 )
 
   
 
     
 
     
 
     
 
     
 
 
Total Commercial
    6,646.2       6,544.8       101.4       152.1       (50.7 )
 
   
 
     
 
     
 
     
 
     
 
 
SPECIALTY INSURANCE
                                       
Executive Protection
    4,140.8       3,995.0       145.8       169.5       (23.7 )
Financial Institutions
    1,815.8       1,720.4       95.4       30.2       65.2  
Other
    1,127.9       1,042.2       85.7       53.0       32.7  
 
   
 
     
 
     
 
     
 
     
 
 
Total Specialty
    7,084.5       6,757.6       326.9       252.7       74.2  
 
   
 
     
 
     
 
     
 
     
 
 
TOTAL
  $ 15,034.5     $ 14,521.2     $ 513.3     $ 448.1     $ 65.2  
 
   
 
     
 
     
 
     
 
     
 
 

Page 4 of 9


 

THE CHUBB CORPORATION — WORLDWIDE
PROPERTY AND CASUALTY UNDERWRITING RESULTS
FOR THE THREE MONTHS ENDED MARCH 31, 2004 AND 2003
(MILLIONS OF DOLLARS)

                                                                 
    Personal                   Other   Total
    Automobile
  Homeowners
  Personal
  Personal
    2004
  2003
  2004
  2003
  2004
  2003
  2004
  2003
Net Premiums Written
  $ 144.6     $ 132.9     $ 341.7     $ 312.5     $ 129.5     $ 119.6     $ 615.8     $ 565.0  
Increase (Decrease) in Unearned Premiums
    (5.5 )     (1.0 )     (36.5 )     (13.4 )     (2.0 )     (0.4 )     (44.0 )     (14.8 )
 
   
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
 
Net Premiums Earned
    150.1       133.9       378.2       325.9       131.5       120.0       659.8       579.8  
 
   
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
 
Net Losses Paid
    95.2       84.9       215.7       194.5       44.2       41.7       355.1       321.1  
Increase (Decrease) in Outstanding Losses
    6.0       10.1       62.8       53.3       16.2       12.6       85.0       76.0  
 
   
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
 
Net Losses Incurred
    101.2       95.0       278.5       247.8       60.4       54.3       440.1       397.1  
 
   
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
 
Expenses Incurred
    41.6       40.5       122.7       118.9       40.2       38.9       204.5       198.3  
Dividends Incurred
    0.0       0.0       0.0       0.0       0.0       0.0       0.0       0.0  
 
   
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
 
Statutory Underwriting Income (Loss)
  $ 7.3     $ (1.6 )   $ (23.0 )   $ (40.8 )   $ 30.9     $ 26.8     $ 15.2     $ (15.6 )
 
   
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
 
Ratios After Dividends to Policyholders:
                                                               
Loss
    67.4 %     71.0 %     73.7 %     76.0 %     45.9 %     45.3 %     66.7 %     68.5 %
Expense
    28.8       30.4       35.9       38.1       31.1       32.5       33.2       35.1  
 
   
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
 
Combined
    96.2 %     101.4 %     109.6 %     114.1 %     77.0 %     77.8 %     99.9 %     103.6 %
 
   
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
 
Premiums Written as a % of Total
    4.8 %     4.9 %     11.3 %     11.7 %     4.3 %     4.5 %     20.4 %     21.1 %

Page 5 of 9


 

THE CHUBB CORPORATION — WORLDWIDE
PROPERTY AND CASUALTY UNDERWRITING RESULTS
FOR THE THREE MONTHS ENDED MARCH 31, 2004 AND 2003
(MILLIONS OF DOLLARS)

                                                                                 
    Commercial   Commercial   Workers’   Property   Total
    Multiple Peril
  Casualty
  Compensation
  and Marine
  Commercial
    2004
  2003
  2004
  2003
  2004
  2003
  2004
  2003
  2004
  2003
Net Premiums Written
  $ 302.8     $ 276.5     $ 412.2     $ 344.1     $ 221.5     $ 188.4     $ 290.6     $ 273.3     $ 1,227.1     $ 1,082.3  
Increase (Decrease) in Unearned Premiums
    24.3       40.3       65.8       63.2       55.6       58.9       26.9       41.2       172.6       203.6  
 
   
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
 
Net Premiums Earned
    278.5       236.2       346.4       280.9       165.9       129.5       263.7       232.1       1,054.5       878.7  
 
   
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
 
Net Losses Paid
    118.6       127.6       171.9       149.5       59.8       56.7       97.0       97.5       447.3       431.3  
Increase (Decrease) in Outstanding Losses
    20.8       (6.1 )     31.5       7.3       52.1       25.6       (3.0 )     25.3       101.4       52.1  
 
   
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
 
Net Losses Incurred
    139.4       121.5       203.4       156.8       111.9       82.3       94.0       122.8       548.7       483.4  
 
   
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
 
Expenses Incurred
    104.5       100.9       117.8       101.0       45.6       41.8       105.0       94.3       372.9       338.0  
Dividends Incurred
    0.0       0.1       0.0       0.0       4.9       3.0       0.0       0.0       4.9       3.1  
 
   
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
 
Statutory Underwriting Income (Loss)
  $ 34.6     $ 13.7     $ 25.2     $ 23.1     $ 3.5     $ 2.4     $ 64.7     $ 15.0     $ 128.0     $ 54.2  
 
   
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
 
Ratios After Dividends to Policyholders:
                                                                               
Loss
    50.1 %     51.5 %     58.7 %     55.8 %     69.5 %     65.1 %     35.7 %     52.9 %     52.3 %     55.2 %
Expense
    34.5       36.5       28.6       29.4       21.1       22.5       36.1       34.5       30.5       31.3  
 
   
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
 
Combined
    84.6 %     88.0 %     87.3 %     85.2 %     90.6 %     87.6 %     71.8 %     87.4 %     82.8 %     86.5 %
 
   
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
 
Premiums Written as a % of Total
    10.0 %     10.3 %     13.7 %     12.9 %     7.3 %     7.0 %     9.6 %     10.3 %     40.6 %     40.5 %

Page 6 of 9


 

THE CHUBB CORPORATION — WORLDWIDE
PROPERTY AND CASUALTY UNDERWRITING RESULTS
FOR THE THREE MONTHS ENDED MARCH 31, 2004 AND 2003
(MILLIONS OF DOLLARS)

                                                                                 
    Executive   Financial   Other   Total   Worldwide
    Protection
  Institutions
  Specialty
  Specialty
  Total
    2004
  2003
  2004
  2003
  2004
  2003
  2004
  2003
  2004
  2003
Net Premiums Written
  $ 554.6     $ 521.6     $ 234.2     $ 223.8     $ 385.7     $ 282.0     $ 1,174.5     $ 1,027.4     $ 3,017.4     $ 2,674.7  
Increase (Decrease) in Unearned Premiums
    30.4       59.3       22.4       34.7       42.0       66.7       94.8       160.7       223.4       349.5  
 
   
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
 
Net Premiums Earned
    524.2       462.3       211.8       189.1       343.7       215.3       1,079.7       866.7       2,794.0       2,325.2  
 
   
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
 
Net Losses Paid
    253.0       173.5       82.6       79.2       89.3       151.7       424.9       404.4       1,227.3       1,156.8  
Increase (Decrease) in Outstanding Losses
    145.8       192.4       95.4       77.9       85.7       (49.7 )     326.9       220.6       513.3       348.7  
 
   
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
 
Net Losses Incurred
    398.8       365.9       178.0       157.1       175.0       102.0       751.8       625.0       1,740.6       1,505.5  
 
   
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
 
Expenses Incurred
    141.2       127.7       60.7       59.5       128.0       88.0       329.9       275.2       907.3       811.5  
Dividends Incurred
    0.0       0.0       1.7       2.2       0.7       0.7       2.4       2.9       7.3       6.0  
 
   
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
 
Statutory Underwriting Income (Loss)
  $ (15.8 )   $ (31.3 )   $ (28.6 )   $ (29.7 )   $ 40.0     $ 24.6     $ (4.4 )   $ (36.4 )     138.8       2.2  
 
   
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
                 
Increase in Deferred Acquisition Costs
                                                                    39.6       67.9  
 
                                                                   
 
     
 
 
GAAP Underwriting Income (Loss)
                                                                  $ 178.4     $ 70.1  
 
                                                                   
 
     
 
 
Ratios After Dividends to Policyholders:
                                                                               
Loss
    76.1 %     79.1 %     84.7 %     84.1 %     51.0 %     47.5 %     69.8 %     72.3 %     62.5 %     64.9 %
Expense
    25.4       24.5       26.1       26.8       33.3       31.3       28.1       26.9       30.1       30.4  
 
   
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
 
Combined
    101.5 %     103.6 %     110.8 %     110.9 %     84.3 %     78.8 %     97.9 %     99.2 %     92.6 %     95.3 %
 
   
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
     
 
 
Premiums Written as a % of Total
    18.4 %     19.5 %     7.8 %     8.4 %     12.8 %     10.5 %     39.0 %     38.4 %     100.0 %     100.0 %

Page 7 of 9


 

THE CHUBB CORPORATION — WORLDWIDE
PROPERTY AND CASUALTY UNDERWRITING RESULTS
FOR THE THREE MONTHS ENDED MARCH 31, 2004 AND 2003
(MILLIONS OF DOLLARS)

                                                 
                                    Worldwide
    United States
  Foreign
  Total
    2004
  2003
  2004
  2003
  2004
  2003
Net Premiums Written
  $ 2,396.0     $ 2,150.5     $ 621.4     $ 524.2     $ 3,017.4     $ 2,674.7  
Increase (Decrease) in Unearned Premiums
    118.7       238.3       104.7       111.2       223.4       349.5  
 
   
 
     
 
     
 
     
 
     
 
     
 
 
Net Premiums Earned
    2,277.3       1,912.2       516.7       413.0       2,794.0       2,325.2  
 
   
 
     
 
     
 
     
 
     
 
     
 
 
Net Losses Paid
    1,068.4       1,020.9       158.9       135.9       1,227.3       1,156.8  
Increase (Decrease) in Outstanding Losses
    386.7       248.1       126.6       100.6       513.3       348.7  
 
   
 
     
 
     
 
     
 
     
 
     
 
 
Net Losses Incurred
    1,455.1       1,269.0       285.5       236.5       1,740.6       1,505.5  
 
   
 
     
 
     
 
     
 
     
 
     
 
 
Expenses Incurred
    690.2       620.2       217.1       191.3       907.3       811.5  
Dividends Incurred
    7.3       6.0       0.0       0.0       7.3       6.0  
 
   
 
     
 
     
 
     
 
     
 
     
 
 
Statutory Underwriting Income (Loss)
  $ 124.7     $ 17.0     $ 14.1     $ (14.8 )     138.8       2.2  
 
   
 
     
 
     
 
     
 
                 
Increase in Deferred Acquisition Costs
                                    39.6       67.9  
 
                                   
 
     
 
 
GAAP Underwriting Income (Loss)
                                  $ 178.4     $ 70.1  
 
                                   
 
     
 
 
Ratios After Dividends to Policyholders:
                                               
Loss
    64.1 %     66.6 %     55.3 %     57.3 %     62.5 %     64.9 %
Expense
    28.9       28.9       34.9       36.5       30.1       30.4  
 
   
 
     
 
     
 
     
 
     
 
     
 
 
Combined
    93.0 %     95.5 %     90.2 %     93.8 %     92.6 %     95.3 %
 
   
 
     
 
     
 
     
 
     
 
     
 
 
Premiums Written as a % of Total
    79.4 %     80.4 %     20.6 %     19.6 %     100.0 %     100.0 %

Page 8 of 9


 

THE CHUBB CORPORATION

Definitions of Key Terms

Underwriting Income (Loss)

Management evaluates underwriting results separately from investment results. The underwriting operations consist of three separate business units: personal insurance, commercial insurance and specialty insurance. Performance of the business units is based on statutory underwriting results. Statutory accounting principles differ in certain respects from generally accepted accounting principles (GAAP). Under statutory accounting principles, policy acquisition and other underwriting expenses are recognized immediately, not at the time premiums are earned. Statutory underwriting income (loss) is arrived at by reducing premiums earned by losses and loss expenses incurred and statutory underwriting expenses incurred.

Management uses underwriting results determined in accordance with GAAP, among other measures, to assess the overall performance of the underwriting operations. To convert statutory underwriting results to a GAAP basis, policy acquisition expenses are deferred and amortized over the period in which the related premiums are earned. Underwriting income (loss) determined in accordance with GAAP is defined as premiums earned less losses and loss expenses incurred and GAAP underwriting expenses incurred.

Property and Casualty Investment Income After Income Tax

Management uses property and casualty investment income after income tax, a non-GAAP financial measure, to evaluate its investment performance because it reflects the impact of any change in the proportion of the investment portfolio invested in tax-exempt securities and is therefore more meaningful for analysis purposes than investment income before income taxes.

Book Value per Common Share with Available-for-Sale Fixed Maturities at Amortized Cost

Book value per share represents the portion of consolidated shareholders’ equity attributable to one share of common stock outstanding as of the balance sheet date. Consolidated shareholders’ equity includes, as part of accumulated other comprehensive income, the after-tax appreciation or depreciation on the Corporation’s available-for-sale fixed maturities, which are carried at market value. The appreciation or depreciation on available-for-sale fixed maturities is subject to fluctuation due to changes in interest rates and therefore could distort the analysis of trends. Management believes that book value per common share with available-for-sale fixed maturities at amortized cost, a non-GAAP financial measure, is an important measure of the underlying equity attributable to one share of common stock.

Combined Ratio or Combined Loss and Expense Ratio

The combined loss and expense ratio, expressed as a percentage, is the key measure of underwriting profitability. Management uses the combined loss and expense ratio calculated in accordance with statutory accounting principles applicable to property and casualty insurance companies to evaluate the performance of the underwriting operations. It is the sum of the ratio of losses and loss expenses to premiums earned (loss ratio) plus the ratio of statutory underwriting expenses to premiums written (expense ratio) after reducing both premium amounts by dividends to policyholders.

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