UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
Current Report
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Item 2.02. Results of Operations and Financial Condition
On July 27, 2021, Chubb Limited issued a Press Release reporting its second quarter 2021 results and the availability of its second quarter 2021 Financial Supplement. The Press Release and the Financial Supplement are attached hereto as Exhibit 99.1 and Exhibit 99.2, respectively, and are hereby incorporated herein by reference.
The information furnished pursuant to this Item 2.02, including Exhibit 99.1 and Exhibit 99.2, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities under that Section and shall not be deemed to be incorporated by reference into any filing of the Company under the Securities Act of 1933 or the Exchange Act.
Item 9.01. Financial Statements and Exhibits
(d) | Exhibits |
Exhibit |
Description | |
99.1 | Press Release, Dated July 27, 2021, Reporting Second Quarter 2021 Results | |
99.2 | Second Quarter 2021 Financial Supplement | |
104 | Cover Page Interactive Data File (the cover page XBRL tags are embedded within the Inline XBRL document) |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Chubb Limited | ||
By: | /s/ Peter Enns | |
Peter Enns | ||
Executive Vice President and Chief Financial Officer |
DATE: July 27, 2021
Exhibit 99.1
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Chubb Limited Bärengasse 32 CH-8001 Zurich Switzerland |
www.chubb.com @Chubb |
News Release
Chubb Reports Strong Second Quarter Net Income Per Share of
$5.06 and Record Core Operating Income Per Share of $3.62;
Consolidated Net Premiums Written Up 14.3% Globally, with
Commercial P&C Lines Up 19.9%; Best Organic P&C Growth in Over
15 Years
· | Net income was strong at $2.27 billion versus a net loss of $(331) million prior year, and core operating income was a record $1.62 billion versus a core operating loss of $(254) million prior year. |
· | P&C net premiums written were up 15.5% globally for the quarter and 12.6% for the first six months, powered by commercial lines and the best organic P&C growth since 2004. The quarters result comprised growth of 20.7% in commercial lines excluding Agriculture, 11.0% in Agriculture and 5.6% in P&C consumer lines. Foreign exchange had a positive impact on P&C net premiums written growth of 2.8 percentage points in the quarter. |
· | The P&C combined ratio was 85.5% compared with 112.3% prior year. P&C current accident year underwriting income excluding catastrophe losses was a record $1.20 billion, up 27.0%, driven by a P&C current accident year combined ratio excluding catastrophe losses of 85.4% compared with 87.4% prior year. The 2.0 percentage point decrease was substantially driven by improvement in the loss ratio. |
· | Pre-tax and after-tax catastrophe losses, net of reinsurance and including reinstatement premiums, were $280 million and $226 million, respectively, compared with $1.81 billion and $1.51 billion, respectively, prior year. |
· | Pre-tax net investment income was $884 million, up 7.0% from the prior year, and adjusted net investment income was $945 million, up 9.4% from the prior year. Both were record results. |
· | Annualized return on equity (ROE) and core operating ROE were 15.2% and 11.5%, respectively. Annualized core operating return on tangible equity was 17.7%. |
· | Book and tangible book value per share were up 4.2% and 5.0%, respectively, for the quarter, and were up 3.8% and 4.3%, respectively, from December 31, 2020. |
ZURICH July 27, 2021 Chubb Limited (NYSE: CB) today reported net income for the quarter ended June 30, 2021 of $2.27 billion, or $5.06 per share, and core operating income of $1.62 billion, or $3.62 per share. Book value was favorably impacted by total after-tax net realized and unrealized gains of $1.52 billion, including a $1.35 billion gain in the investment portfolio, principally due to lower interest rates and mark-to-market gains on private equities, and favorable foreign exchange of $215 million. Book and tangible book value per share now stand at $136.90 and $91.48, respectively.
Chubb®, Chubb logo® and Chubb. Insured.SM are trademarks of Chubb. | 1 |
Chubb Limited News Release
Chubb Limited
Second Quarter Summary
(in millions of U.S. dollars, except per share amounts)
(Unaudited)
(Per Share) (1) | ||||||||||||||||||||||||
2021 | 2020 | Change | 2021 | 2020 | Change | |||||||||||||||||||
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Net income (loss) |
$2,265 | $(331) | NM | $5.06 | $(0.73) | NM | ||||||||||||||||||
Amortization of fair value adjustment of acquired invested assets and long-term debt, net of tax |
14 | 19 | (26.3)% | 0.03 | 0.04 | (25.0)% | ||||||||||||||||||
Adjusted net realized (gains) losses, net of tax |
(658) | 58 | NM | (1.47) | 0.13 | NM | ||||||||||||||||||
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Core operating income (loss), net of tax |
$1,621 | $(254) | NM | $3.62 | $(0.56) | NM | ||||||||||||||||||
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(1) | Refer to page 12 for information on use of basic and diluted shares. |
For the three months ended June 30, 2021 and 2020, the tax expenses (benefits) related to the table above were $(3) million and $(5) million for amortization of fair value adjustment of acquired invested assets and long-term debt; $16 million and $(11) million, respectively, for adjusted net realized gains and losses; and $304 million and $(46) million, respectively, for core operating income (loss).
For the six months ended June 30, 2021, net income was $4.57 billion, or $10.13 per share, compared with a net loss of $(79) million, or $(0.17) per share, for 2020. Core operating income was $2.76 billion, or $6.13 per share, compared with $966 million, or $2.13 per share, for 2020. The P&C combined ratio was 88.6% compared to 101.0% prior year, and the current accident year P&C combined ratio excluding catastrophe losses was 85.3% compared to 87.5% prior year. Book value was favorably impacted by after-tax net realized and unrealized gains of $785 million, including $264 million in the companys investment portfolio, $297 million from favorable foreign exchange and $203 million from mark-to-market gains in the companys variable annuity reinsurance portfolio.
Chubb®, Chubb logo® and Chubb. Insured.SM are trademarks of Chubb. | 2 |
Chubb Limited News Release
Chubb Limited
Six Months Ended Summary
(in millions of U.S. dollars, except per share amounts)
(Unaudited)
(Per Share) (1) | ||||||||||||||||||||||||
2021 | 2020 | Change | 2021 | 2020 | Change | |||||||||||||||||||
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|
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Net income (loss) |
$4,565 | $(79) | NM | $10.13 | $(0.17) | NM | ||||||||||||||||||
Amortization of fair value adjustment of acquired invested assets and long-term debt, net of tax |
30 | 41 | (26.8)% | 0.07 | 0.09 | (22.2)% | ||||||||||||||||||
Adjusted net realized (gains) losses, net of tax |
(1,832) | 1,004 | NM | (4.07) | 2.22 | NM | ||||||||||||||||||
Use of weighted-average dilutive shares |
-- | -- | -- | -- | (0.01) | NM | ||||||||||||||||||
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Core operating income, net of tax |
$2,763 | $966 | 186.0% | $6.13 | $2.13 | 187.8% | ||||||||||||||||||
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(1) Refer to page 12 for information on use of basic and diluted shares. |
|
For the six months ended June 30, 2021 and 2020, the tax expenses (benefits) related to the table above were $(8) million and $(10) million, respectively, for amortization of fair value adjustment of acquired invested assets and long-term debt; $149 million and $(28) million, respectively, for adjusted net realized gains and losses; and $514 million and $191 million, respectively, for core operating income.
Evan G. Greenberg, Chairman and Chief Executive Officer of Chubb Limited, commented: Chubb had simply an outstanding quarter, highlighted by record core operating earnings and underwriting results. We produced the best P&C premium revenue growth globally in over 15 years, powered by our commercial P&C businesses and supported by continued robust commercial P&C pricing. Operating earnings in the quarter were $1.62 billion or $3.62 per share.
Our published and current accident year combined ratios of 85.5% and 85.4%, respectively, reflect 200 basis points of underwriting margin improvement, almost entirely loss ratio-related. Current accident year underwriting income of $1.2 billion was up 27%, while on the other side of the balance sheet adjusted net investment income in the quarter of $945 million was also a record and up nearly 9.5% from prior year.
P&C net premiums written were up 15.5% globally, with commercial premiums excluding agriculture up nearly 21%. For perspective, we have averaged double-digit commercial P&C growth over the past 10 quarters, and both second quarter and year-to-date growth were the strongest since 2004. In North America, we grew our commercial P&C premiums over 16%, while in our international operations premiums grew 33% on a published basis, or 24% in constant dollars. Growth in the quarter was broad based. Net premiums written in our consumer lines remain impacted by the pandemics effects on travel and other business and consumer-related activity but are beginning to improve and, in fact, increased 5.6% in the quarter.
We are capitalizing on a strong commercial P&C pricing environment in most all important regions of the world. Overall rates increased in our North America and international commercial P&C businesses by 13.5% and 16%, respectively, and were well in excess of loss costs. From everything we see today, I am confident these market conditions will continue.
Our company is firing on all cylinders we are growing our business while we continue to expand underwriting margins. We will continue to outperform and deliver strong, sustainable shareholder value.
Chubb®, Chubb logo® and Chubb. Insured.SM are trademarks of Chubb. | 3 |
Chubb Limited News Release
Operating highlights for the quarter ended June 30, 2021 were as follows:
Chubb Limited | Q2 | Q2 | ||||||||||
(in millions of U.S. dollars except for percentages) | 2021 | 2020 | Change | |||||||||
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|
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P&C |
||||||||||||
Net premiums written (increase of 12.7% in constant dollars) |
$ | 8,931 | $ | 7,736 | 15.5% | |||||||
Commercial P&C (increase of 17.6% in constant dollars) |
$ | 6,398 | $ | 5,338 | 19.9% | |||||||
Consumer P&C (increase of 2.1% in constant dollars) |
$ | 2,533 | $ | 2,398 | 5.6% | |||||||
Underwriting income (loss) |
$ | 1,191 | $ | (929) | NM | |||||||
Combined ratio |
85.5% | 112.3% | ||||||||||
Current accident year underwriting income excluding catastrophe losses |
$ | 1,203 | $ | 947 | 27.0% | |||||||
Current accident year combined ratio excluding catastrophe losses |
85.4% | 87.4% | ||||||||||
Global P&C (excludes Agriculture) |
||||||||||||
Net premiums written (increase of 12.9% in constant dollars) |
$ | 8,419 | $ | 7,275 | 15.7% | |||||||
Commercial P&C (increase of 18.2% in constant dollars) |
$ | 5,886 | $ | 4,877 | 20.7% | |||||||
Consumer P&C (increase of 2.1% in constant dollars) |
$ | 2,533 | $ | 2,398 | 5.6% | |||||||
Underwriting income (loss) |
$ | 1,142 | $ | (960) | NM | |||||||
Combined ratio |
85.4% | 113.4% | ||||||||||
Current accident year underwriting income excluding catastrophe losses |
$ | 1,150 | $ | 910 | 26.3% | |||||||
Current accident year combined ratio excluding catastrophe losses |
85.3% | 87.3% |
· | Consolidated net premiums earned increased 8.4%. P&C net premiums earned increased 9.1%, comprising growth in both commercial P&C lines and consumer lines of 11.6% and 3.8%, respectively. |
· | The combined ratio included 3.4 percentage points of net catastrophe losses compared with 23.9 percentage points last year. |
· | Total pre-tax and after-tax favorable prior period development were $268 million (3.3 percentage points of the combined ratio) and $224 million, respectively, compared with unfavorable prior period development of $75 million (1.0 percentage point of the combined ratio) and $52 million, respectively, last year. |
· | Pre-tax adjusted net investment income of $945 million was above the guidance range principally due to increased call activity in the companys corporate bond portfolio and higher private equity distributions. |
· | Operating cash flow was $3.12 billion. |
· | Total capital returned to shareholders in the quarter was $2.27 billion, including share repurchases of $1.92 billion, at an average purchase price of $169.19 per share, and dividends of $352 million. Total capital returned to shareholders for the six months ended June 30, 2021 was $3.14 billion, including share repurchases of $2.44 billion, at an average purchase price of $168.66 per share, and dividends of $704 million. The company recently announced that its Board of Directors approved a one-time incremental share repurchase program of up to $5.0 billion through June 30, 2022. |
Chubb®, Chubb logo® and Chubb. Insured.SM are trademarks of Chubb. | 4 |
Chubb Limited News Release
Details of financial results by business segment are available in the Chubb Limited Financial Supplement. Key segment items for the quarter ended June 30, 2021 are presented below:
Chubb Limited | Q2 | Q2 | ||||||||||
(in millions of U.S. dollars except for percentages) | 2021 | 2020 | Change | |||||||||
Total North America P&C Insurance |
||||||||||||
(Comprising NA Commercial P&C Insurance, NA Personal P&C Insurance and NA Agricultural Insurance) |
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Net premiums written |
$ | 6,160 | $ | 5,508 | 11.8% | |||||||
Commercial P&C |
$ | 4,645 | $ | 4,013 | 15.7% | |||||||
Consumer P&C |
$ | 1,515 | $ | 1,495 | 1.3% | |||||||
Combined ratio |
82.9% | 108.9% | ||||||||||
Current accident year combined ratio excluding catastrophe losses |
82.4% | 84.9% | ||||||||||
North America Commercial P&C Insurance |
||||||||||||
Net premiums written |
$ | 4,285 | $ | 3,720 | 15.2% | |||||||
Commercial P&C excluding A&H |
$ | 4,133 | $ | 3,552 | 16.3% | |||||||
Major accounts retail and excess and surplus (E&S) wholesale |
$ | 2,487 | $ | 2,199 | 13.1% | |||||||
Middle market and small commercial |
$ | 1,646 | $ | 1,353 | 21.6% | |||||||
Accident and health (A&H) |
$ | 152 | $ | 168 | (8.9)% | |||||||
Combined ratio |
83.1% | 117.3% | ||||||||||
Current accident year combined ratio excluding catastrophe losses |
82.9% | 86.0% | ||||||||||
North America Personal P&C Insurance |
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Net premiums written |
$ | 1,363 | $ | 1,327 | 2.6% | |||||||
Combined ratio |
80.7% | 88.8% | ||||||||||
Current accident year combined ratio excluding catastrophe losses |
79.2% | 79.6% | ||||||||||
North America Agricultural Insurance |
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Net premiums written |
$ | 512 | $ | 461 | 11.0% | |||||||
Combined ratio |
88.1% | 91.8% | ||||||||||
Current accident year combined ratio excluding catastrophe losses |
87.1% | 90.2% | ||||||||||
Overseas General Insurance |
||||||||||||
Net premiums written (increase of 15.0% in constant dollars) |
$ | 2,497 | $ | 2,021 | 23.6% | |||||||
Commercial P&C (increase of 23.4% in constant dollars) |
$ | 1,479 | $ | 1,118 | 32.4% | |||||||
Consumer P&C (increase of 4.6% in constant dollars) |
$ | 1,018 | $ | 903 | 12.8% | |||||||
Combined ratio |
83.9% | 107.1% | ||||||||||
Current accident year combined ratio excluding catastrophe losses |
88.4% | 90.7% |
· | North America Commercial P&C Insurance: The current accident year combined ratio excluding catastrophe losses decreased 3.1 percentage points, including a 2.4 percentage point decrease in the loss ratio. |
· | North America Personal P&C Insurance: The current accident year combined ratio excluding catastrophe losses decreased 0.4 percentage point, including a 1.1 percentage point decrease in the loss ratio. |
· | North America Agricultural Insurance: The current accident year combined ratio excluding catastrophe losses decreased 3.1 percentage points, including a 1.8 percentage point decrease in the loss ratio. |
Chubb®, Chubb logo® and Chubb. Insured.SM are trademarks of Chubb. | 5 |
Chubb Limited News Release
· | Overseas General Insurance: The current accident year combined ratio excluding catastrophe losses decreased 2.3 percentage points, including a 1.0 percentage point decrease in the loss ratio. |
· | Global Reinsurance: Net premiums written were $274 million, up 32.4%. The combined ratio was 86.6% compared with 76.6% prior year. The current accident year combined ratio excluding catastrophe losses was 81.2% compared with 78.2% prior year. |
· | Life Insurance: Net premiums written were $615 million, down 0.7%. International life insurance net premiums written increased 11.6%, or 6.3% in constant dollars, while net premiums written and deposits collected were up 55.0%, or 47.8% in constant dollars. Combined Insurance North America net premiums written decreased 5.9%, driven by the impact of the pandemic on face-to-face and worksite sales. Segment income was $102 million, up 16.1%. |
Chubb®, Chubb logo® and Chubb. Insured.SM are trademarks of Chubb. | 6 |
Chubb Limited News Release
All comparisons are with the same period last year unless otherwise specifically stated.
Please refer to the Chubb Limited Financial Supplement, dated June 30, 2021, which is posted on the companys 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 second quarter earnings conference call on Wednesday, July 28, 2021 beginning at 8:30 a.m. Eastern. The earnings conference call will be available via live webcast at investors.chubb.com or by dialing 888-254-3590 (within the United States) or 323-994-2093 (international), passcode 8683056. Please refer to the Chubb website under Events and Presentations for details. A replay of the call will be available until Wednesday, August 11, 2021 and the archived webcast will be available on our website for approximately one month. To listen to the replay, please click here to register and receive dial-in numbers.
About Chubb
Chubb is the worlds 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 31,000 people worldwide. Additional information can be found at: www.chubb.com.
Investor Contact
Karen Beyer: (212) 827-4445; karen.beyer@chubb.com
Media Contact
Jeffrey Zack: (212) 827-4444; jeffrey.zack@chubb.com
Chubb®, Chubb logo® and Chubb. Insured.SM are trademarks of Chubb. | 7 |
Chubb Limited News Release
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 the acquisition of The Chubb Corporation (Chubb Corp) of $22 million in Q2 2021 and $48 million for the six months ended June 30, 2021 and including investment income of $39 million in Q2 2021 and $80 million for the six months ended June 30, 2021 from partially owned investment companies (private equity partnerships) where our ownership interest is in excess of three percent that are accounted for under the equity method. 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, policy acquisition costs and administrative expenses from net premiums earned by our P&C operations. We use P&C underwriting income 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, excludes from net income the after-tax impact of adjusted net realized gains (losses) and the amortization of fair value adjustment of acquired invested assets and long-term debt related to the Chubb Corp acquisition. 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 the fair value adjustments related to purchased invested assets and long-term debt due to
Chubb®, Chubb logo® and Chubb. Insured.SM are trademarks of Chubb. | 8 |
Chubb Limited News Release
the size and complexity of this acquisition. 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 shareholders equity for the period adjusted to exclude unrealized gains (losses) on investments, net of tax. For the ROTE calculation, the denominator is also adjusted to exclude goodwill and other intangible assets, net of tax. These measures enhances 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.
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 companys 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 companys P&C insurance business. We believe that these measures are useful and meaningful to investors as they are used by management to assess the companys 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 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.
International life insurance net premiums written and deposits collected includes deposits collected on universal life and investment contracts (life deposits). Life deposits are not reflected as revenues in our consolidated statements of operations in accordance with GAAP. However, we include life deposits in presenting growth in our life insurance business because new life deposits are an important component of production and key to our efforts to grow our business.
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, return on equity, and net investment income.
NM - not meaningful comparison
Chubb®, Chubb logo® and Chubb. Insured.SM are trademarks of Chubb. | 9 |
Chubb Limited News Release
Cautionary Statement Regarding Forward-Looking Statements:
Forward-looking statements made in this press release, such as those related to company performance, pricing, economic and market conditions, 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 managements 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®, Chubb logo® and Chubb. Insured.SM are trademarks of Chubb. | 10 |
Chubb Limited News Release
Chubb Limited | ||||
Summary Consolidated Balance Sheets | ||||
(in millions of U.S. dollars, except per share data) | ||||
(Unaudited)
|
June 30 2021 |
December 31 2020 | |||||||
Assets |
||||||||
Investments |
$ | 121,370 | $ | 118,669 | ||||
Cash |
1,843 | 1,747 | ||||||
Insurance and reinsurance balances receivable |
11,720 | 10,480 | ||||||
Reinsurance recoverable on losses and loss expenses |
15,725 | 15,592 | ||||||
Goodwill and other intangible assets |
21,200 | 21,211 | ||||||
Other assets |
25,316 | 23,075 | ||||||
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Total assets |
$ | 197,174 | $ | 190,774 | ||||
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Liabilities |
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Unpaid losses and loss expenses |
$ | 70,289 | $ | 67,811 | ||||
Unearned premiums |
19,167 | 17,652 | ||||||
Other liabilities |
47,656 | 45,870 | ||||||
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Total liabilities |
$ | 137,112 | $ | 131,333 | ||||
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Shareholders equity |
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Total shareholders equity |
60,062 | 59,441 | ||||||
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Total liabilities and shareholders equity |
$ | 197,174 | $ | 190,774 | ||||
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Book value per common share |
$ | 136.90 | $ | 131.88 | ||||
Tangible book value per common share |
$ | 91.48 | $ | 87.69 | ||||
Book value per common share excluding cumulative translation losses (1) |
$ | 139.92 | $ | 135.51 | ||||
Tangible book value per common share excluding cumulative translation losses (1) |
$ | 93.69 | $ | 90.24 |
(1) | Cumulative translation losses were $1.3 billion in 2021 ($1.0 billion on tangible and $0.3 billion on intangible net assets) and $1.6 billion in 2020 ($1.1 billion on tangible and $0.5 billion on intangible net assets). |
Chubb®, Chubb logo® and Chubb. Insured.SM are trademarks of Chubb. | 11 |
Chubb Limited News Release
Chubb Limited | ||||||||
Summary Consolidated Financial Data | ||||||||
(in millions of U.S. dollars, except share, per share data, and ratios) | ||||||||
(Unaudited) |
Three Months Ended June 30 |
Six Months Ended June 30 | |||||||||||||||
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2021 |
2020 | 2021 | 2020 | |||||||||||||
Gross premiums written |
$ | 11,860 | $ | 10,040 | $ | 22,405 | $ | 19,792 | ||||||||
Net premiums written |
9,546 | 8,355 | 18,208 | 16,332 | ||||||||||||
Net premiums earned |
8,813 | 8,128 | 17,034 | 15,922 | ||||||||||||
Losses and loss expenses |
5,006 | 6,577 | 10,059 | 11,062 | ||||||||||||
Policy benefits |
185 | 223 | 352 | 352 | ||||||||||||
Policy acquisition costs |
1,698 | 1,593 | 3,363 | 3,208 | ||||||||||||
Administrative expenses |
775 | 727 | 1,519 | 1,468 | ||||||||||||
Net investment income |
884 | 827 | 1,747 | 1,688 | ||||||||||||
Net realized gains (losses) |
(33) | 30 | 854 | (928) | ||||||||||||
Interest expense |
122 | 128 | 244 | 260 | ||||||||||||
Other income (expense): |
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Gains (losses) from separate account assets |
15 | 40 | 19 | (16) | ||||||||||||
Other |
762 | (98) | 1,248 | (97) | ||||||||||||
Amortization of purchased intangibles |
73 | 72 | 145 | 145 | ||||||||||||
Income tax expense (benefit) |
317 | (62) | 655 | 153 | ||||||||||||
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Net income (loss) |
$ | 2,265 | $ | (331) | $ | 4,565 | $ | (79) | ||||||||
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Earnings per share: (1) |
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Net income (loss) |
$ | 5.06 | $ | (0.73) | $ | 10.13 | $ | (0.17) | ||||||||
Core operating income (loss) |
$ | 3.62 | $ | (0.56) | $ | 6.13 | $ | 2.13 | ||||||||
Weighted average shares outstanding (1) |
448.0 | 451.4 | 450.7 | 451.6 | ||||||||||||
(1) In periods where core operating loss and net loss are recognized, inclusion of incremental dilution is anti-dilutive and therefore basic shares are used in the calculation of per share earnings. For the three and six months ended June 30, 2020, the effect of dilutive securities was 1,395,951 shares and 2,044,144 shares, respectively. Weighted-average shares outstanding used to calculate earnings per share for the 2021 periods and core operating income per share for the six months ended June 30, 2020 include the effect of dilutive securities.
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P&C combined ratio |
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Loss and loss expense ratio |
58.7% | 85.2% | 61.1% | 72.8% | ||||||||||||
Policy acquisition cost ratio |
18.4% | 18.5% | 18.9% | 19.3% | ||||||||||||
Administrative expense ratio |
8.4% | 8.6% | 8.6% | 8.9% | ||||||||||||
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P&C combined ratio |
85.5% | 112.3% | 88.6% | 101.0% | ||||||||||||
P&C underwriting income (loss) |
$ | 1,191 | $ | (929) | $ | 1,813 | $ | (151) |
Chubb®, Chubb logo® and Chubb. Insured.SM are trademarks of Chubb. | 12 |
Exhibit 99.2
Chubb Limited
Financial Supplement
for the Quarter Ended June 30, 2021
Investor Contact
Karen Beyer: (212) 827-4445
email: investorrelations@chubb.com
This report is for informational purposes only. It should be read in conjunction with documents filed by Chubb Limited with the Securities and Exchange Commission, including the most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q.
Cautionary Statement Regarding Forward-Looking Statements
Any forward-looking statements made in this financial supplement reflect Chubb Limiteds 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 which may cause actual results to differ materially from such statements. For example, forward-looking statements related to financial performance, including exposures, reserves and recoverables, could be affected by the frequency and severity of unpredictable catastrophic events, actual loss experience, uncertainties in the reserving or settlement process, currency exchange fluctuations, 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 receivable and credit developments among reinsurers.
Our forward-looking statements could also be affected by, among other things, competition, pricing and policy term trends, market acceptance, changes in demand, actual market developments, rating agency action, possible terrorism or the outbreak and effects of war, and such other factors identified in our filings with the Securities and Exchange Commission. 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
Financial Supplement Table of Contents
Page | ||||||
I. |
Financial Highlights |
|||||
- Consolidated Financial Highlights |
1 | |||||
II. |
Consolidated Results |
|||||
- Consolidated Statement of Operations |
2 | |||||
- P&C Results - Consecutive Quarters |
3 | |||||
- Global P&C Results - Consecutive Quarters |
4 | |||||
- Summary Consolidated Balance Sheets |
5 | |||||
- Line of Business |
6 | |||||
- Consolidated Results by Segment |
7 - 10 | |||||
III. |
Segment Results |
|||||
- North America Commercial P&C Insurance |
11 | |||||
- North America Personal P&C Insurance |
12 | |||||
- North America Agricultural Insurance |
13 | |||||
- Overseas General Insurance |
14 | |||||
- Global Reinsurance |
15 | |||||
- Life Insurance |
16 | |||||
- Corporate |
17 | |||||
IV. |
Balance Sheet Details |
|||||
- Loss Reserve Rollforward |
18 | |||||
- Reinsurance Recoverable Analysis |
19 | |||||
- Investment Portfolio |
20 - 23 | |||||
- Net Realized and Unrealized Gains (Losses) |
24 - 25 | |||||
- Debt and Capital |
26 | |||||
- Computation of Basic and Diluted Earnings Per Share |
27 | |||||
- Book Value and Book Value per Common Share |
28 | |||||
V. |
Other Disclosures |
|||||
- Non-GAAP Financial Measures |
29 - 35 | |||||
- Glossary |
36 |
Chubb Limited
Consolidated Financial Highlights
(in millions of U.S. dollars, except share, per share data, and ratios)
(Unaudited)
Note: All dollar amounts in the Financial Supplement are rounded. However, percent changes and ratios are calculated using whole dollars. Accordingly, calculations using rounded dollars may differ.
Three months ended June 30 | Constant $ | Constant $ | Six months ended June 30 | Constant $ | Constant $ | |||||||||||||||||||||||||||||||||||
2021 | 2020 | % Change | 2020 | % Change | 2021 | 2020 | % Change | 2020 | % Change | |||||||||||||||||||||||||||||||
Gross premiums written |
$ | 11,860 | $ | 10,040 | 18.1 | % | $ | 10,279 | 15.4 | % | $ | 22,405 | $ | 19,792 | 13.2 | % | $ | 20,165 | 11.1 | % | ||||||||||||||||||||
Net premiums written |
$ | 9,546 | $ | 8,355 | 14.3 | % | $ | 8,561 | 11.5 | % | $ | 18,208 | $ | 16,332 | 11.5 | % | $ | 16,653 | 9.3 | % | ||||||||||||||||||||
P&C net premiums written (1) |
$ | 8,931 | $ | 7,736 | 15.5 | % | $ | 7,922 | 12.7 | % | $ | 16,973 | $ | 15,068 | 12.6 | % | $ | 15,362 | 10.5 | % | ||||||||||||||||||||
Net premiums written - Commercial |
$ | 6,398 | $ | 5,338 | 19.9 | % | $ | 5,440 | 17.6 | % | $ | 12,105 | $ | 10,277 | 17.8 | % | $ | 10,451 | 15.8 | % | ||||||||||||||||||||
Net premiums written - Consumer |
$ | 2,533 | $ | 2,398 | 5.6 | % | $ | 2,482 | 2.1 | % | $ | 4,868 | $ | 4,791 | 1.6 | % | $ | 4,911 | -0.9 | % | ||||||||||||||||||||
Net premiums earned |
$ | 8,813 | $ | 8,128 | 8.4 | % | $ | 8,347 | 5.6 | % | $ | 17,034 | $ | 15,922 | 7.0 | % | $ | 16,238 | 4.9 | % | ||||||||||||||||||||
Net investment income |
$ | 884 | $ | 827 | 7.0 | % | $ | 834 | 5.9 | % | $ | 1,747 | $ | 1,688 | 3.5 | % | $ | 1,698 | 2.9 | % | ||||||||||||||||||||
Adjusted net investment income |
$ | 945 | $ | 865 | 9.4 | % | $ | 872 | 8.3 | % | $ | 1,875 | $ | 1,782 | 5.2 | % | $ | 1,792 | 4.6 | % | ||||||||||||||||||||
P&C underwriting income (loss) |
$ | 1,191 | $ | (929 | ) | NM | $ | (936 | ) | NM | $ | 1,813 | $ | (151 | ) | NM | $ | (152 | ) | NM | ||||||||||||||||||||
P&C CAY underwriting income ex Cats |
$ | 1,203 | $ | 947 | 27.0 | % | $ | 972 | 23.7 | % | $ | 2,333 | $ | 1,844 | 26.6 | % | $ | 1,884 | 23.8 | % | ||||||||||||||||||||
Core operating income (loss) |
$ | 1,621 | $ | (254 | ) | NM | $ | (254 | ) | NM | $ | 2,763 | $ | 966 | 186.0 | % | $ | 971 | 184.6 | % | ||||||||||||||||||||
Net income (loss) |
$ | 2,265 | $ | (331 | ) | NM | $ | 4,565 | $ | (79 | ) | NM | ||||||||||||||||||||||||||||
Operating cash flow |
$ | 3,122 | $ | 1,985 | $ | 5,227 | $ | 3,697 | ||||||||||||||||||||||||||||||||
P&C combined ratio |
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Loss and loss expense ratio |
58.7 | % | 85.2 | % | 61.1 | % | 72.8 | % | ||||||||||||||||||||||||||||||||
Policy acquisition cost and administrative expense ratio |
26.8 | % | 27.1 | % | 27.5 | % | 28.2 | % | ||||||||||||||||||||||||||||||||
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Combined ratio |
85.5 | % | 112.3 | % | 88.6 | % | 101.0 | % | ||||||||||||||||||||||||||||||||
P&C Current Accident Year (CAY) combined ratio ex Catastrophe losses (Cats) |
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CAY loss and loss expense ratio ex Cats |
58.6 | % | 60.4 | % | 57.9 | % | 59.3 | % | ||||||||||||||||||||||||||||||||
CAY policy acquisition cost and administrative expense ratio ex Cats |
26.8 | % | 27.0 | % | 27.4 | % | 28.2 | % | ||||||||||||||||||||||||||||||||
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CAY combined ratio ex Cats |
85.4 | % | 87.4 | % | 85.3 | % | 87.5 | % | ||||||||||||||||||||||||||||||||
Global P&C CAY combined ratio ex Cats |
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CAY loss and loss expense ratio ex Cats |
57.5 | % | 59.3 | % | 57.2 | % | 58.6 | % | ||||||||||||||||||||||||||||||||
CAY policy acquisition cost and administrative expense ratio ex Cats |
27.8 | % | 28.0 | % | 28.1 | % | 28.8 | % | ||||||||||||||||||||||||||||||||
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CAY combined ratio ex Cats |
85.3 | % | 87.3 | % | 85.3 | % | 87.4 | % | ||||||||||||||||||||||||||||||||
ROE |
15.2 | % | -2.5 | % | 15.3 | % | -0.3 | % | ||||||||||||||||||||||||||||||||
Core operating return on equity (ROE) |
11.5 | % | -2.0 | % | 9.9 | % | 3.7 | % | ||||||||||||||||||||||||||||||||
Core operating return on tangible equity (ROTE) |
17.7 | % | -3.2 | % | 15.4 | % | 6.0 | % | ||||||||||||||||||||||||||||||||
Effective tax rate |
12.3 | % | 15.8 | % | 12.5 | % | 206.8 | % | ||||||||||||||||||||||||||||||||
Core operating effective tax rate |
15.8 | % | 15.3 | % | 15.7 | % | 16.5 | % | ||||||||||||||||||||||||||||||||
Earnings per share (2) |
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Net income (loss) |
$ | 5.06 | $ | (0.73 | ) | NM | $ | 10.13 | $ | (0.17 | ) | NM | ||||||||||||||||||||||||||||
Core operating income (loss) |
$ | 3.62 | $ | (0.56 | ) | NM | $ | 6.13 | $ | 2.13 | 187.8 | % | ||||||||||||||||||||||||||||
Weighted average basic common shares outstanding |
445.1 | 451.4 | 447.8 | 451.6 | ||||||||||||||||||||||||||||||||||||
Weighted average diluted common shares outstanding |
448.0 | 452.8 | 450.7 | 453.7 | ||||||||||||||||||||||||||||||||||||
% Change | % Change | |||||||||||||||||||||||||||||||||||||||
June 30 | March 31 | 2Q-21 vs. | December 31 | 2Q-21 vs. | ||||||||||||||||||||||||||||||||||||
2021 | 2021 | 1Q-21 | 2020 | 4Q-20 | ||||||||||||||||||||||||||||||||||||
Book value per common share |
$ | 136.90 | $ | 131.37 | 4.2 | % | $ | 131.88 | 3.8 | % | ||||||||||||||||||||||||||||||
Tangible book value per common share |
$ | 91.48 | $ | 87.16 | 5.0 | % | $ | 87.69 | 4.3 | % |
(1) | Q2 2021 P&C net premiums written growth was adversely impacted by lower year-over-year large structured transactions written of $241 million, partially offset by the prior year COVID-19 related exposure adjustments of $184 million on in-force policies. Excluding these items, P&C net premiums written increased 16.4% in the quarter and 13.1% YTD. |
(2) | In periods where core operating loss and net loss are recognized, inclusion of incremental dilution is anti-dilutive and therefore basic shares are used in the calculation of per share earnings. Refer to page 27 for additional details. |
Financial Highlights | Page 1 |
Chubb Limited
Statement of Operations - Consecutive Quarters
(in millions of U.S. dollars)
(Unaudited)
Consolidated Statements of Operations
YTD | YTD | Full Year | ||||||||||||||||||||||||||||||
2Q-21 | 1Q-21 | 4Q-20 | 3Q-20 | 2Q-20 | 2021 | 2020 | 2020 | |||||||||||||||||||||||||
Gross premiums written |
$ | 11,860 | $ | 10,545 | $ | 10,249 | $ | 11,220 | $ | 10,040 | $ | 22,405 | $ | 19,792 | $ | 41,261 | ||||||||||||||||
Net premiums written |
9,546 | 8,662 | 8,410 | 9,078 | 8,355 | 18,208 | 16,332 | 33,820 | ||||||||||||||||||||||||
Net premiums earned |
8,813 | 8,221 | 8,430 | 8,765 | 8,128 | 17,034 | 15,922 | 33,117 | ||||||||||||||||||||||||
Adjusted losses and loss expenses (1) |
5,003 | 5,054 | 4,810 | 5,834 | 6,578 | 10,057 | 11,065 | 21,709 | ||||||||||||||||||||||||
Realized (gains) losses on crop derivatives |
(3 | ) | 1 | (3 | ) | (1 | ) | 1 | (2 | ) | 3 | (1 | ) | |||||||||||||||||||
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Losses and loss expenses |
5,006 | 5,053 | 4,813 | 5,835 | 6,577 | 10,059 | 11,062 | 21,710 | ||||||||||||||||||||||||
Adjusted policy benefits (2) |
170 | 163 | 184 | 174 | 183 | 333 | 368 | 726 | ||||||||||||||||||||||||
Gains (losses) from fair value changes in separate account liabilities |
(15 | ) | (4 | ) | (50 | ) | (24 | ) | (40 | ) | (19 | ) | 16 | (58 | ) | |||||||||||||||||
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Policy benefits |
185 | 167 | 234 | 198 | 223 | 352 | 352 | 784 | ||||||||||||||||||||||||
Policy acquisition costs |
1,698 | 1,665 | 1,694 | 1,645 | 1,593 | 3,363 | 3,208 | 6,547 | ||||||||||||||||||||||||
Administrative expenses |
775 | 744 | 778 | 733 | 727 | 1,519 | 1,468 | 2,979 | ||||||||||||||||||||||||
Adjusted net investment income (3) |
945 | 930 | 924 | 900 | 865 | 1,875 | 1,782 | 3,606 | ||||||||||||||||||||||||
Other (income) expense from private equity partnerships |
(39 | ) | (41 | ) | (51 | ) | (32 | ) | (8 | ) | (80 | ) | (32 | ) | (115 | ) | ||||||||||||||||
Amortization expense of fair value adjustment on acquired invested assets |
(22 | ) | (26 | ) | (26 | ) | (28 | ) | (30 | ) | (48 | ) | (62 | ) | (116 | ) | ||||||||||||||||
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Net investment income |
884 | 863 | 847 | 840 | 827 | 1,747 | 1,688 | 3,375 | ||||||||||||||||||||||||
Adjusted realized gains (losses) (4) |
(36 | ) | 888 | 568 | (142 | ) | 31 | 852 | (925 | ) | (499 | ) | ||||||||||||||||||||
Realized gains (losses) on crop derivatives |
3 | (1 | ) | 3 | 1 | (1 | ) | 2 | (3 | ) | 1 | |||||||||||||||||||||
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Net realized gains (losses) |
(33 | ) | 887 | 571 | (141 | ) | 30 | 854 | (928 | ) | (498 | ) | ||||||||||||||||||||
Adjusted interest expense (5) |
127 | 127 | 131 | 135 | 134 | 254 | 271 | 537 | ||||||||||||||||||||||||
Amortization benefit of fair value adjustment on acquired long term debt |
(5 | ) | (5 | ) | (5 | ) | (5 | ) | (6 | ) | (10 | ) | (11 | ) | (21 | ) | ||||||||||||||||
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Interest expense |
122 | 122 | 126 | 130 | 128 | 244 | 260 | 516 | ||||||||||||||||||||||||
Gains (losses) from fair value changes in separate account assets |
15 | 4 | 50 | 24 | 40 | 19 | (16 | ) | 58 | |||||||||||||||||||||||
Net realized gains (losses) related to unconsolidated entities |
710 | 419 | 506 | 422 | (100 | ) | 1,129 | (107 | ) | 821 | ||||||||||||||||||||||
Other income (expense) from private equity partnerships |
39 | 41 | 51 | 32 | 8 | 80 | 32 | 115 | ||||||||||||||||||||||||
Other income (expense) - operating |
13 | 26 | 15 | 7 | (6 | ) | 39 | (22 | ) | | ||||||||||||||||||||||
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Other income (expense) |
777 | 490 | 622 | 485 | (58 | ) | 1,267 | (113 | ) | 994 | ||||||||||||||||||||||
Amortization expense of purchased intangibles |
73 | 72 | 73 | 72 | 72 | 145 | 145 | 290 | ||||||||||||||||||||||||
Income tax expense (benefit) |
317 | 338 | 334 | 142 | (62 | ) | 655 | 153 | 629 | |||||||||||||||||||||||
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Net income (loss) |
$ | 2,265 | $ | 2,300 | $ | 2,418 | $ | 1,194 | $ | (331 | ) | $ | 4,565 | $ | (79 | ) | $ | 3,533 | ||||||||||||||
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(1) | Adjusted losses and loss expenses used throughout this report includes realized gains and losses on crop derivatives. |
(2) | Adjusted policy benefits used throughout this report excludes gains and losses from fair value changes in separate account liabilities. |
(3) | Adjusted net investment income used throughout this report excludes Amortization expense of fair value adjustment on acquired invested assets and includes income from private equity partnerships where we hold more than three percent ownership. |
(4) | Adjusted realized gains (losses) used throughout this report excludes realized gains and losses on crop derivatives. |
(5) | Adjusted interest expense used throughout this report excludes Amortization benefit of fair value adjustment on acquired long term debt. |
Statement of Operations | Page 2 |
Chubb Limited
P&C Underwriting Results - Consecutive Quarters
(in millions of U.S. dollars, except ratios)
(Unaudited)
Chubb Limited P&C Underwriting Results
YTD | YTD | Full Year | ||||||||||||||||||||||||||||||
2Q-21 | 1Q-21 | 4Q-20 | 3Q-20 | 2Q-20 | 2021 | 2020 | 2020 | |||||||||||||||||||||||||
P&C underwriting income (loss) (Including Corporate and excluding Life Insurance) |
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Gross premiums written |
$ | 11,208 | $ | 9,890 | $ | 9,571 | $ | 10,575 | $ | 9,387 | $ | 21,098 | $ | 18,456 | $ | 38,602 | ||||||||||||||||
Net premiums written |
8,931 | 8,042 | 7,770 | 8,468 | 7,736 | 16,973 | 15,068 | 31,306 | ||||||||||||||||||||||||
Net premiums earned |
8,208 | 7,626 | 7,786 | 8,166 | 7,520 | 15,834 | 14,683 | 30,635 | ||||||||||||||||||||||||
Adjusted losses and loss expenses |
4,818 | 4,856 | 4,642 | 5,651 | 6,407 | 9,674 | 10,692 | 20,985 | ||||||||||||||||||||||||
Policy acquisition costs |
1,507 | 1,486 | 1,479 | 1,470 | 1,397 | 2,993 | 2,832 | 5,781 | ||||||||||||||||||||||||
Administrative expenses |
692 | 662 | 696 | 653 | 645 | 1,354 | 1,310 | 2,659 | ||||||||||||||||||||||||
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P&C underwriting income (loss) |
$ | 1,191 | $ | 622 | $ | 969 | $ | 392 | $ | (929 | ) | $ | 1,813 | $ | (151 | ) | $ | 1,210 | ||||||||||||||
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P&C CAY underwriting income ex Cats |
$ | 1,203 | $ | 1,130 | $ | 1,059 | $ | 1,171 | $ | 947 | $ | 2,333 | $ | 1,844 | $ | 4,074 | ||||||||||||||||
% Change versus prior year period |
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Net premiums written |
15.5 | % | 9.7 | % | 5.4 | % | 5.7 | % | -0.4 | % | 12.6 | % | 3.9 | % | 4.8 | % | ||||||||||||||||
Net premiums written - Commercial |
19.9 | % | 15.6 | % | 10.0 | % | 10.4 | % | 4.2 | % | 17.8 | % | 7.5 | % | 8.9 | % | ||||||||||||||||
Net premiums written - Consumer |
5.6 | % | -2.5 | % | -3.9 | % | -4.6 | % | -9.2 | % | 1.6 | % | -3.0 | % | -3.6 | % | ||||||||||||||||
Net premiums earned |
9.1 | % | 6.5 | % | 6.3 | % | 5.7 | % | 2.7 | % | 7.8 | % | 5.7 | % | 5.8 | % | ||||||||||||||||
Net premiums written constant $ |
12.7 | % | 8.1 | % | 5.0 | % | 6.4 | % | 1.4 | % | 10.5 | % | 5.1 | % | 5.4 | % | ||||||||||||||||
Net premiums written - Commercial |
17.6 | % | 13.9 | % | 9.5 | % | 10.8 | % | 5.4 | % | 15.8 | % | 8.4 | % | 9.3 | % | ||||||||||||||||
Net premiums written - Consumer |
2.1 | % | -3.9 | % | -4.0 | % | -3.3 | % | -6.6 | % | -0.9 | % | -1.3 | % | -2.5 | % | ||||||||||||||||
Net premiums earned constant $ |
6.3 | % | 5.1 | % | 6.0 | % | 6.3 | % | 4.6 | % | 5.8 | % | 6.8 | % | 6.5 | % | ||||||||||||||||
P&C combined ratio |
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Loss and loss expense ratio |
58.7 | % | 63.7 | % | 59.6 | % | 69.2 | % | 85.2 | % | 61.1 | % | 72.8 | % | 68.5 | % | ||||||||||||||||
Policy acquisition cost ratio |
18.4 | % | 19.5 | % | 19.0 | % | 18.0 | % | 18.5 | % | 18.9 | % | 19.3 | % | 18.9 | % | ||||||||||||||||
Administrative expense ratio |
8.4 | % | 8.6 | % | 9.0 | % | 8.0 | % | 8.6 | % | 8.6 | % | 8.9 | % | 8.7 | % | ||||||||||||||||
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Combined ratio |
85.5 | % | 91.8 | % | 87.6 | % | 95.2 | % | 112.3 | % | 88.6 | % | 101.0 | % | 96.1 | % | ||||||||||||||||
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CAY P&C combined ratio ex Cats |
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CAY loss and loss expense ratio ex Cats |
58.6 | % | 57.2 | % | 58.5 | % | 59.7 | % | 60.4 | % | 57.9 | % | 59.3 | % | 59.2 | % | ||||||||||||||||
CAY policy acquisition cost and administrative expense ratio ex Cats |
26.8 | % | 28.0 | % | 27.9 | % | 26.0 | % | 27.0 | % | 27.4 | % | 28.2 | % | 27.5 | % | ||||||||||||||||
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CAY combined ratio ex Cats |
85.4 | % | 85.2 | % | 86.4 | % | 85.7 | % | 87.4 | % | 85.3 | % | 87.5 | % | 86.7 | % | ||||||||||||||||
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Other ratios |
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Net premiums written/gross premiums written |
80 | % | 81 | % | 81 | % | 80 | % | 82 | % | 80 | % | 82 | % | 81 | % | ||||||||||||||||
Expense ratio |
26.8 | % | 28.1 | % | 28.0 | % | 26.0 | % | 27.1 | % | 27.5 | % | 28.2 | % | 27.6 | % | ||||||||||||||||
Expense ratio excluding A&H |
25.1 | % | 26.4 | % | 26.0 | % | 24.0 | % | 25.2 | % | 25.7 | % | 26.3 | % | 25.6 | % | ||||||||||||||||
Catastrophe reinstatement premiums (expensed) collected - pre-tax |
$ | 8 | $ | (18 | ) | $ | 3 | $ | 7 | $ | (20 | ) | $ | (10 | ) | $ | (20 | ) | $ | (10 | ) | |||||||||||
Catastrophe losses - pre-tax |
$ | 288 | $ | 682 | $ | 299 | $ | 932 | $ | 1,781 | $ | 970 | $ | 2,018 | $ | 3,249 | ||||||||||||||||
Unfavorable (favorable) prior period development (PPD) - pre-tax |
$ | (268 | ) | $ | (192 | ) | $ | (206 | ) | $ | (146 | ) | $ | 75 | $ | (460 | ) | $ | (43 | ) | $ | (395 | ) | |||||||||
Impact of catastrophe losses ex COVID-19 on P&C combined ratio - Unfavorable |
3.4 | % | 9.1 | % | 3.8 | % | 11.3 | % | 5.8 | % | 6.2 | % | 4.5 | % | 6.1 | % | ||||||||||||||||
Impact of COVID-19 catastrophe losses on P&C combined ratio - Unfavorable |
0.0 | % | 0.0 | % | 0.0 | % | 0.0 | % | 18.1 | % | 0.0 | % | 9.3 | % | 4.5 | % | ||||||||||||||||
Impact of catastrophe losses on P&C combined ratio - Unfavorable |
3.4 | % | 9.1 | % | 3.8 | % | 11.3 | % | 23.9 | % | 6.2 | % | 13.8 | % | 10.6 | % | ||||||||||||||||
Impact of PPD on P&C combined ratio - Unfavorable (favorable) |
-3.3 | % | -2.5 | % | -2.6 | % | -1.8 | % | 1.0 | % | -2.9 | % | -0.3 | % | -1.2 | % | ||||||||||||||||
Impact of Cats and PPD on P&C combined ratio - Unfavorable |
0.1 | % | 6.6 | % | 1.2 | % | 9.5 | % | 24.9 | % | 3.3 | % | 13.5 | % | 9.4 | % |
P&C Results | Page 3 |
Chubb Limited
Global P&C Underwriting Results - Consecutive Quarters
(in millions of U.S. dollars, except ratios)
(Unaudited)
Global P&C includes the companys North America Commercial P&C Insurance segment (refer to page 11), North America Personal P&C Insurance segment (refer to page 12), Overseas General Insurance segment (refer to page 14), Global Reinsurance segment (refer to page 15), and Corporate (refer to page 17). Global P&C excludes the North America Agricultural Insurance and Life Insurance segments.
Global P&C (Including Corporate and excluding Agriculture)
2Q-21 | 1Q-21 | 4Q-20 | 3Q-20 | 2Q-20 | YTD 2021 |
YTD 2020 |
Full Year 2020 |
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Global P&C underwriting income (loss) |
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Gross premiums written |
$ | 10,502 | $ | 9,624 | $ | 9,259 | $ | 9,243 | $ | 8,735 | $ | 20,126 | $ | 17,584 | $ | 36,086 | ||||||||||||||||
Net premiums written |
8,419 | 7,859 | 7,528 | 7,482 | 7,275 | 16,278 | 14,450 | 29,460 | ||||||||||||||||||||||||
Net premiums earned |
7,798 | 7,516 | 7,405 | 7,195 | 7,144 | 15,314 | 14,213 | 28,813 | ||||||||||||||||||||||||
Adjusted losses and loss expenses |
4,487 | 4,771 | 4,321 | 4,806 | 6,094 | 9,258 | 10,314 | 19,441 | ||||||||||||||||||||||||
Policy acquisition costs |
1,480 | 1,474 | 1,452 | 1,414 | 1,368 | 2,954 | 2,792 | 5,658 | ||||||||||||||||||||||||
Administrative expenses |
689 | 659 | 699 | 648 | 642 | 1,348 | 1,303 | 2,650 | ||||||||||||||||||||||||
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Global P&C underwriting income (loss) |
$ | 1,142 | $ | 612 | $ | 933 | $ | 327 | $ | (960 | ) | $ | 1,754 | $ | (196 | ) | $ | 1,064 | ||||||||||||||
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Global P&C CAY underwriting income ex Cats |
$ | 1,150 | $ | 1,114 | $ | 1,025 | $ | 1,078 | $ | 910 | $ | 2,264 | $ | 1,799 | $ | 3,902 | ||||||||||||||||
% Change versus prior year period |
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Net premiums written |
15.7 | % | 9.5 | % | 6.0 | % | 5.8 | % | -0.3 | % | 12.6 | % | 3.9 | % | 4.9 | % | ||||||||||||||||
Net premiums earned |
9.1 | % | 6.3 | % | 7.3 | % | 6.0 | % | 2.9 | % | 7.8 | % | 5.6 | % | 6.1 | % | ||||||||||||||||
Net premiums written constant $ |
12.9 | % | 7.9 | % | 5.7 | % | 6.6 | % | 1.6 | % | 10.4 | % | 5.2 | % | 5.7 | % | ||||||||||||||||
Net premiums earned constant $ |
6.2 | % | 5.0 | % | 6.9 | % | 6.7 | % | 4.9 | % | 5.6 | % | 6.8 | % | 6.8 | % | ||||||||||||||||
Combined ratio |
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Loss and loss expense ratio |
57.5 | % | 63.5 | % | 58.4 | % | 66.8 | % | 85.3 | % | 60.5 | % | 72.6 | % | 67.5 | % | ||||||||||||||||
Policy acquisition cost ratio |
19.0 | % | 19.6 | % | 19.6 | % | 19.7 | % | 19.1 | % | 19.2 | % | 19.6 | % | 19.6 | % | ||||||||||||||||
Administrative expense ratio |
8.9 | % | 8.8 | % | 9.4 | % | 9.0 | % | 9.0 | % | 8.8 | % | 9.2 | % | 9.2 | % | ||||||||||||||||
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Combined ratio |
85.4 | % | 91.9 | % | 87.4 | % | 95.5 | % | 113.4 | % | 88.5 | % | 101.4 | % | 96.3 | % | ||||||||||||||||
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CAY combined ratio ex Cats |
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CAY loss and loss expense ratio ex Cats |
57.5 | % | 57.0 | % | 57.0 | % | 56.4 | % | 59.3 | % | 57.2 | % | 58.6 | % | 57.6 | % | ||||||||||||||||
CAY policy acquisition cost and administrative expense ratio ex Cats |
27.8 | % | 28.2 | % | 29.1 | % | 28.6 | % | 28.0 | % | 28.1 | % | 28.8 | % | 28.9 | % | ||||||||||||||||
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CAY combined ratio ex Cats |
85.3 | % | 85.2 | % | 86.1 | % | 85.0 | % | 87.3 | % | 85.3 | % | 87.4 | % | 86.5 | % | ||||||||||||||||
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Other ratios |
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Net premiums written/gross premiums written |
80 | % | 82 | % | 81 | % | 81 | % | 83 | % | 81 | % | 82 | % | 82 | % | ||||||||||||||||
Expense ratio |
27.9 | % | 28.4 | % | 29.0 | % | 28.7 | % | 28.1 | % | 28.0 | % | 28.8 | % | 28.8 | % | ||||||||||||||||
Expense ratio excluding A&H |
26.1 | % | 26.6 | % | 27.2 | % | 26.7 | % | 26.2 | % | 26.4 | % | 26.9 | % | 26.9 | % | ||||||||||||||||
Catastrophe reinstatement premiums (expensed) collected - pre-tax |
$ | 8 | $ | (18 | ) | $ | 4 | $ | 7 | $ | (20 | ) | $ | (10 | ) | $ | (20 | ) | $ | (9 | ) | |||||||||||
Catastrophe losses - pre-tax |
$ | 284 | $ | 674 | $ | 288 | $ | 922 | $ | 1,775 | $ | 958 | $ | 2,004 | $ | 3,214 | ||||||||||||||||
Unfavorable (favorable) prior period development (PPD) - pre-tax |
$ | (268 | ) | $ | (190 | ) | $ | (192 | ) | $ | (164 | ) | $ | 75 | $ | (458 | ) | $ | (29 | ) | $ | (385 | ) |
Global P&C | Page 4 |
Chubb Limited
Summary Consolidated Balance Sheets
(in millions of U.S. dollars, except per share data)
(Unaudited)
June 30 | March 31 | December 31 | ||||||||||
2021 | 2021 | 2020 | ||||||||||
Assets |
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Fixed maturities available for sale, at fair value |
$ | 92,163 | $ | 91,071 | $ | 90,699 | ||||||
Fixed maturities held to maturity, at amortized cost |
10,673 | 11,132 | 11,653 | |||||||||
Equity securities, at fair value |
4,607 | 4,405 | 4,027 | |||||||||
Short-term investments, at fair value |
4,470 | 3,735 | 4,345 | |||||||||
Other investments |
9,457 | 8,636 | 7,945 | |||||||||
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121,370 | 118,979 | 118,669 | ||||||||||
Cash |
1,843 | 1,684 | 1,747 | |||||||||
Securities lending collateral |
2,369 | 2,076 | 1,844 | |||||||||
Insurance and reinsurance balances receivable |
11,720 | 10,573 | 10,480 | |||||||||
Reinsurance recoverable on losses and loss expenses |
15,725 | 15,914 | 15,592 | |||||||||
Deferred policy acquisition costs |
5,605 | 5,443 | 5,402 | |||||||||
Value of business acquired |
255 | 258 | 263 | |||||||||
Prepaid reinsurance premiums |
3,141 | 2,835 | 2,769 | |||||||||
Goodwill and other intangible assets |
21,200 | 21,161 | 21,211 | |||||||||
Investments in partially-owned insurance companies |
2,983 | 2,871 | 2,813 | |||||||||
Other assets |
10,963 | 10,183 | 9,984 | |||||||||
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Total assets |
$ | 197,174 | $ | 191,977 | $ | 190,774 | ||||||
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Liabilities |
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Unpaid losses and loss expenses |
$ | 70,289 | $ | 69,255 | $ | 67,811 | ||||||
Unearned premiums |
19,167 | 18,040 | 17,652 | |||||||||
Future policy benefits |
5,930 | 5,839 | 5,713 | |||||||||
Insurance and reinsurance balances payable |
7,525 | 6,566 | 6,708 | |||||||||
Securities lending payable |
2,369 | 2,076 | 1,844 | |||||||||
Accounts payable, accrued expenses, and other liabilities |
15,989 | 15,456 | 15,457 | |||||||||
Deferred tax liabilities |
581 | 482 | 892 | |||||||||
Long-term debt |
14,954 | 14,879 | 14,948 | |||||||||
Trust preferred securities |
308 | 308 | 308 | |||||||||
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Total liabilities |
137,112 | 132,901 | 131,333 | |||||||||
Shareholders equity |
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Total shareholders equity, excl. AOCI |
58,240 | 58,118 | 56,572 | |||||||||
Accumulated other comprehensive income (loss) (AOCI) |
1,822 | 958 | 2,869 | |||||||||
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Total shareholders equity |
60,062 | 59,076 | 59,441 | |||||||||
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Total liabilities and shareholders equity |
$ | 197,174 | $ | 191,977 | $ | 190,774 | ||||||
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Book value per common share |
$ | 136.90 | $ | 131.37 | $ | 131.88 | ||||||
% change over prior quarter |
4.2 | % | -0.4 | % | 5.5 | % | ||||||
Tangible book value per common share |
$ | 91.48 | $ | 87.16 | $ | 87.69 | ||||||
% change over prior quarter |
5.0 | % | -0.6 | % | 8.1 | % |
Consol Bal Sheet | Page 5 |
Chubb Limited
Consolidated Net Premiums Written by Line of Business
(in millions of U.S. dollars)
(Unaudited)
Constant $ | YTD | YTD | Constant $ | |||||||||||||||||||||||||||||
2Q-21 | 2Q-20 | % Change | % Change | 2021 | 2020 | % Change | % Change | |||||||||||||||||||||||||
Net premiums written |
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Commercial multiple peril (1) |
$ | 316 | $ | 267 | 18.0 | % | 18.0 | % | $ | 579 | $ | 508 | 13.9 | % | 13.9 | % | ||||||||||||||||
Commercial casualty |
1,609 | 1,478 | 8.9 | % | 8.5 | % | 3,258 | 2,819 | 15.6 | % | 14.7 | % | ||||||||||||||||||||
Workers compensation |
546 | 467 | 17.0 | % | 17.0 | % | 1,109 | 1,053 | 5.3 | % | 5.3 | % | ||||||||||||||||||||
Professional liability |
1,263 | 997 | 26.7 | % | 23.0 | % | 2,353 | 1,909 | 23.3 | % | 20.3 | % | ||||||||||||||||||||
Surety |
138 | 117 | 18.5 | % | 14.3 | % | 296 | 267 | 11.2 | % | 10.7 | % | ||||||||||||||||||||
Property and other short-tail lines |
1,740 | 1,344 | 29.5 | % | 24.0 | % | 3,334 | 2,678 | 24.5 | % | 20.1 | % | ||||||||||||||||||||
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Total Commercial P&C lines |
5,612 | 4,670 | 20.2 | % | 17.7 | % | 10,929 | 9,234 | 18.4 | % | 16.3 | % | ||||||||||||||||||||
Agriculture |
512 | 461 | 11.0 | % | 11.0 | % | 695 | 618 | 12.4 | % | 12.4 | % | ||||||||||||||||||||
Personal automobile |
364 | 353 | 3.2 | % | -1.0 | % | 751 | 794 | -5.5 | % | -6.2 | % | ||||||||||||||||||||
Personal homeowners |
1,025 | 980 | 4.5 | % | 3.5 | % | 1,800 | 1,753 | 2.6 | % | 1.9 | % | ||||||||||||||||||||
Personal other |
464 | 402 | 15.5 | % | 9.0 | % | 932 | 820 | 13.6 | % | 8.6 | % | ||||||||||||||||||||
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Total Personal lines |
1,853 | 1,735 | 6.8 | % | 3.9 | % | 3,483 | 3,367 | 3.4 | % | 1.7 | % | ||||||||||||||||||||
Total Property and Casualty lines |
7,977 | 6,866 | 16.2 | % | 13.8 | % | 15,107 | 13,219 | 14.3 | % | 12.4 | % | ||||||||||||||||||||
Global A&H lines (2) |
951 | 951 | 0.1 | % | -4.2 | % | 1,933 | 2,018 | -4.2 | % | -7.5 | % | ||||||||||||||||||||
Reinsurance lines |
274 | 207 | 32.4 | % | 30.7 | % | 481 | 425 | 13.1 | % | 11.7 | % | ||||||||||||||||||||
Life |
344 | 331 | 3.8 | % | -0.6 | % | 687 | 670 | 2.5 | % | -0.3 | % | ||||||||||||||||||||
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Total consolidated |
$ | 9,546 | $ | 8,355 | 14.3 | % | 11.5 | % | $ | 18,208 | $ | 16,332 | 11.5 | % | 9.3 | % | ||||||||||||||||
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(1) | Commercial multiple peril represents retail package business (property and general liability). |
(2) | For purposes of this schedule only, A&H results from our Combined North America and International businesses, normally included in the Life Insurance and Overseas General Insurance segments, respectively, as well as the A&H results of our North America Commercial P&C segment, are included in Global A&H lines above. |
Line of Business | Page 6 |
Chubb Limited
Consolidated Results - Three months ended June 30, 2021
(in millions of U.S. dollars, except ratios)
(Unaudited)
Q2 2021 |
North America Commercial P&C Insurance |
North America Personal P&C Insurance |
North America Agricultural Insurance |
Overseas General Insurance |
Global Reinsurance |
Corporate | Total P&C |
Life Insurance |
Total Consolidated |
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Net premiums written |
$ | 4,285 | $ | 1,363 | $ | 512 | $ | 2,497 | $ | 274 | $ | | $ | 8,931 | $ | 615 | $ | 9,546 | ||||||||||||||||||
Net premiums earned |
3,803 | 1,224 | 410 | 2,579 | 192 | | 8,208 | 605 | 8,813 | |||||||||||||||||||||||||||
Adjusted losses and loss expenses |
2,426 | 676 | 331 | 1,186 | 110 | 89 | 4,818 | 185 | 5,003 | |||||||||||||||||||||||||||
Adjusted policy benefits |
| | | | | | | 170 | 170 | |||||||||||||||||||||||||||
Policy acquisition costs |
489 | 245 | 27 | 699 | 47 | | 1,507 | 191 | 1,698 | |||||||||||||||||||||||||||
Administrative expenses |
245 | 67 | 3 | 279 | 10 | 88 | 692 | 83 | 775 | |||||||||||||||||||||||||||
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Underwriting income (loss) |
643 | 236 | 49 | 415 | 25 | (177 | ) | 1,191 | (24 | ) | 1,167 | |||||||||||||||||||||||||
Adjusted net investment income |
535 | 64 | 8 | 149 | 81 | 7 | 844 | 101 | 945 | |||||||||||||||||||||||||||
Other income (expense) - operating |
(14 | ) | 5 | | (2 | ) | | (2 | ) | (13 | ) | 26 | 13 | |||||||||||||||||||||||
Amortization expense of purchased intangibles |
| (3 | ) | (6 | ) | (13 | ) | | (50 | ) | (72 | ) | (1 | ) | (73 | ) | ||||||||||||||||||||
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Segment income (loss) |
$ | 1,164 | $ | 302 | $ | 51 | $ | 549 | $ | 106 | $ | (222 | ) | $ | 1,950 | $ | 102 | $ | 2,052 | |||||||||||||||||
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|||||||||||||||||||
Adjusted interest expense |
(127 | ) | (127 | ) | ||||||||||||||||||||||||||||||||
Income tax expense |
(304 | ) | (304 | ) | ||||||||||||||||||||||||||||||||
|
|
|
|
|||||||||||||||||||||||||||||||||
Core operating income (loss) |
(653 | ) | 1,621 | |||||||||||||||||||||||||||||||||
Amortization of fair value adjustment of acquired invested assets and long-term debt, net of $3 million tax benefit |
(14 | ) | (14 | ) | ||||||||||||||||||||||||||||||||
Adjusted net realized gains (losses), net of $16 million tax (1) |
658 | 658 | ||||||||||||||||||||||||||||||||||
|
|
|
|
|||||||||||||||||||||||||||||||||
Net income (loss) |
$ | (9 | ) | $ | 2,265 | |||||||||||||||||||||||||||||||
|
|
|
|
|||||||||||||||||||||||||||||||||
Combined ratio |
83.1 | % | 80.7 | % | 88.1 | % | 83.9 | % | 86.6 | % | 85.5 | % | ||||||||||||||||||||||||
CAY combined ratio ex Cats |
82.9 | % | 79.2 | % | 87.1 | % | 88.4 | % | 81.2 | % | 85.4 | % |
(1) | Includes Net realized gains (losses) related to unconsolidated entities. |
Consol Results - QTD 2021 | Page 7 |
Chubb Limited
Consolidated Results - Six months ended June 30, 2021
(in millions of U.S. dollars, except ratios)
(Unaudited)
YTD 2021 |
North America Commercial P&C Insurance |
North America Personal P&C Insurance |
North America Agricultural Insurance |
Overseas General Insurance |
Global Reinsurance |
Corporate | Total P&C |
Life Insurance |
Total Consolidated |
|||||||||||||||||||||||||||
Net premiums written |
$ | 7,949 | $ | 2,461 | $ | 695 | $ | 5,387 | $ | 481 | $ | | $ | 16,973 | $ | 1,235 | $ | 18,208 | ||||||||||||||||||
Net premiums earned |
7,477 | 2,408 | 520 | 5,057 | 372 | | 15,834 | 1,200 | 17,034 | |||||||||||||||||||||||||||
Adjusted losses and loss expenses |
4,986 | 1,495 | 416 | 2,449 | 230 | 98 | 9,674 | 383 | 10,057 | |||||||||||||||||||||||||||
Adjusted policy benefits |
| | | | | | | 333 | 333 | |||||||||||||||||||||||||||
Policy acquisition costs |
1,003 | 492 | 39 | 1,367 | 92 | | 2,993 | 370 | 3,363 | |||||||||||||||||||||||||||
Administrative expenses |
499 | 127 | 6 | 545 | 18 | 159 | 1,354 | 165 | 1,519 | |||||||||||||||||||||||||||
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Underwriting income (loss) |
989 | 294 | 59 | 696 | 32 | (257 | ) | 1,813 | (51 | ) | 1,762 | |||||||||||||||||||||||||
Adjusted net investment income |
1,075 | 129 | 15 | 290 | 151 | 16 | 1,676 | 199 | 1,875 | |||||||||||||||||||||||||||
Other income (expense) - operating |
(16 | ) | 4 | | (3 | ) | | (6 | ) | (21 | ) | 60 | 39 | |||||||||||||||||||||||
Amortization expense of purchased intangibles |
| (6 | ) | (13 | ) | (25 | ) | | (99 | ) | (143 | ) | (2 | ) | (145 | ) | ||||||||||||||||||||
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Segment income (loss) |
$ | 2,048 | $ | 421 | $ | 61 | $ | 958 | $ | 183 | $ | (346 | ) | $ | 3,325 | $ | 206 | $ | 3,531 | |||||||||||||||||
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Adjusted interest expense |
(254 | ) | (254 | ) | ||||||||||||||||||||||||||||||||
Income tax expense |
(514 | ) | (514 | ) | ||||||||||||||||||||||||||||||||
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|
|||||||||||||||||||||||||||||||||
Core operating income (loss) |
(1,114 | ) | 2,763 | |||||||||||||||||||||||||||||||||
Amortization of fair value adjustment of acquired invested assets and long-term debt, net of $8 million tax benefit |
(30 | ) | (30 | ) | ||||||||||||||||||||||||||||||||
Adjusted net realized gains (losses), net of $149 million tax (1) |
1,832 | 1,832 | ||||||||||||||||||||||||||||||||||
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|
|||||||||||||||||||||||||||||||||
Net income (loss) |
$ | 688 | $ | 4,565 | ||||||||||||||||||||||||||||||||
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|
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Combined ratio |
86.8 | % | 87.8 | % | 88.7 | % | 86.2 | % | 91.3 | % | 88.6 | % | ||||||||||||||||||||||||
CAY combined ratio ex Cats |
83.6 | % | 78.9 | % | 86.6 | % | 88.1 | % | 79.6 | % | 85.3 | % |
(1) | Includes Net realized gains (losses) related to unconsolidated entities. |
Consol Results - YTD 2021 | Page 8 |
Chubb Limited
Consolidated Results - Three months ended June 30, 2020
(in millions of U.S. dollars, except ratios)
(Unaudited)
North | North | North | ||||||||||||||||||||||||||||||||||
America | America | America | Overseas | |||||||||||||||||||||||||||||||||
Commercial P&C | Personal P&C | Agricultural | General | Global | Total | Life | Total | |||||||||||||||||||||||||||||
Q2 2020 |
Insurance | Insurance | Insurance | Insurance | Reinsurance | Corporate | P&C | Insurance | Consolidated | |||||||||||||||||||||||||||
Net premiums written |
$ | 3,720 | $ | 1,327 | $ | 461 | $ | 2,021 | $ | 207 | $ | | $ | 7,736 | $ | 619 | $ | 8,355 | ||||||||||||||||||
Net premiums earned |
3,595 | 1,192 | 376 | 2,194 | 163 | | 7,520 | 608 | 8,128 | |||||||||||||||||||||||||||
Adjusted losses and loss expenses |
3,498 | 762 | 313 | 1,485 | 73 | 276 | 6,407 | 171 | 6,578 | |||||||||||||||||||||||||||
Adjusted policy benefits |
| | | | | | | 183 | 183 | |||||||||||||||||||||||||||
Policy acquisition costs |
471 | 231 | 29 | 624 | 42 | | 1,397 | 196 | 1,593 | |||||||||||||||||||||||||||
Administrative expenses |
249 | 66 | 3 | 241 | 9 | 77 | 645 | 82 | 727 | |||||||||||||||||||||||||||
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Underwriting income (loss) |
(623 | ) | 133 | 31 | (156 | ) | 39 | (353 | ) | (929 | ) | (24 | ) | (953 | ) | |||||||||||||||||||||
Adjusted net investment income |
509 | 65 | 7 | 121 | 60 | 8 | 770 | 95 | 865 | |||||||||||||||||||||||||||
Other income (expense) - operating |
(6 | ) | (1 | ) | (1 | ) | (5 | ) | (1 | ) | (9 | ) | (23 | ) | 17 | (6 | ) | |||||||||||||||||||
Amortization expense of purchased intangibles |
| (3 | ) | (6 | ) | (11 | ) | | (51 | ) | (71 | ) | (1 | ) | (72 | ) | ||||||||||||||||||||
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Segment income (loss) |
$ | (120 | ) | $ | 194 | $ | 31 | $ | (51 | ) | $ | 98 | $ | (405 | ) | $ | (253 | ) | $ | 87 | $ | (166 | ) | |||||||||||||
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|||||||||||||||||||
Adjusted interest expense |
(134 | ) | (134 | ) | ||||||||||||||||||||||||||||||||
Income tax benefit |
46 | 46 | ||||||||||||||||||||||||||||||||||
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|
|||||||||||||||||||||||||||||||||
Core operating loss |
(493 | ) | (254 | ) | ||||||||||||||||||||||||||||||||
Amortization of fair value adjustment of acquired invested assets and long-term debt, net of $5 million tax benefit |
(19 | ) | (19 | ) | ||||||||||||||||||||||||||||||||
Adjusted net realized gains (losses), net of $11 million tax benefit (1) |
(58 | ) | (58 | ) | ||||||||||||||||||||||||||||||||
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Net loss |
$ | (570 | ) | $ | (331 | ) | ||||||||||||||||||||||||||||||
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Combined ratio |
117.3 | % | 88.8 | % | 91.8 | % | 107.1 | % | 76.6 | % | 112.3 | % | ||||||||||||||||||||||||
CAY combined ratio ex Cats |
86.0 | % | 79.6 | % | 90.2 | % | 90.7 | % | 78.2 | % | 87.4 | % |
(1) | Includes Net realized gains (losses) related to unconsolidated entities. |
Consol Results - QTD 2020 | Page 9 |
Chubb Limited
Consolidated Results - Six months ended June 30, 2020
(in millions of U.S. dollars, except ratios)
(Unaudited)
North | North | North | ||||||||||||||||||||||||||||||||||
America | America | America | Overseas | |||||||||||||||||||||||||||||||||
Commercial P&C | Personal P&C | Agricultural | General | Global | Total | Life | Total | |||||||||||||||||||||||||||||
YTD 2020 |
Insurance | Insurance | Insurance | Insurance | Reinsurance | Corporate | P&C | Insurance | Consolidated | |||||||||||||||||||||||||||
Net premiums written |
$ | 6,972 | $ | 2,434 | $ | 618 | $ | 4,619 | $ | 425 | $ | | $ | 15,068 | $ | 1,264 | $ | 16,332 | ||||||||||||||||||
Net premiums earned |
6,971 | 2,392 | 470 | 4,501 | 349 | | 14,683 | 1,239 | 15,922 | |||||||||||||||||||||||||||
Adjusted losses and loss expenses |
5,679 | 1,445 | 378 | 2,743 | 160 | 287 | 10,692 | 373 | 11,065 | |||||||||||||||||||||||||||
Adjusted policy benefits |
| | | | | | | 368 | 368 | |||||||||||||||||||||||||||
Policy acquisition costs |
963 | 476 | 40 | 1,266 | 87 | | 2,832 | 376 | 3,208 | |||||||||||||||||||||||||||
Administrative expenses |
508 | 134 | 7 | 499 | 19 | 143 | 1,310 | 158 | 1,468 | |||||||||||||||||||||||||||
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Underwriting income (loss) |
(179 | ) | 337 | 45 | (7 | ) | 83 | (430 | ) | (151 | ) | (36 | ) | (187 | ) | |||||||||||||||||||||
Adjusted net investment income |
1,034 | 131 | 16 | 266 | 129 | 16 | 1,592 | 190 | 1,782 | |||||||||||||||||||||||||||
Other income (expense) - operating |
(12 | ) | (3 | ) | (1 | ) | (9 | ) | (1 | ) | (25 | ) | (51 | ) | 29 | (22 | ) | |||||||||||||||||||
Amortization expense of purchased intangibles |
| (6 | ) | (13 | ) | (23 | ) | | (101 | ) | (143 | ) | (2 | ) | (145 | ) | ||||||||||||||||||||
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Segment income (loss) |
$ | 843 | $ | 459 | $ | 47 | $ | 227 | $ | 211 | $ | (540 | ) | $ | 1,247 | $ | 181 | $ | 1,428 | |||||||||||||||||
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Adjusted interest expense |
(271 | ) | (271 | ) | ||||||||||||||||||||||||||||||||
Income tax expense |
(191 | ) | (191 | ) | ||||||||||||||||||||||||||||||||
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Core operating income (loss) |
(1,002 | ) | 966 | |||||||||||||||||||||||||||||||||
Amortization of fair value adjustment of acquired invested assets and long-term debt, net of $10 million tax benefit |
(41 | ) | (41 | ) | ||||||||||||||||||||||||||||||||
Adjusted net realized gains (losses), net of $28 million tax benefit (1) |
(1,004 | ) | (1,004 | ) | ||||||||||||||||||||||||||||||||
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Net loss |
$ | (2,047 | ) | $ | (79 | ) | ||||||||||||||||||||||||||||||
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Combined ratio |
102.6 | % | 85.9 | % | 90.4 | % | 100.2 | % | 76.3 | % | 101.0 | % | ||||||||||||||||||||||||
CAY combined ratio ex Cats |
86.2 | % | 80.4 | % | 90.4 | % | 90.2 | % | 79.2 | % | 87.5 | % |
(1) | Includes Net realized gains (losses) related to unconsolidated entities. |
Consol Results - YTD 2020 | Page 10 |
Chubb Limited
Segment Results - Consecutive Quarters
(in millions of U.S. dollars, except ratios)
(Unaudited)
North America Commercial P&C Insurance
YTD | YTD | Full Year | ||||||||||||||||||||||||||||||
2Q-21 | 1Q-21 | 4Q-20 | 3Q-20 | 2Q-20 | 2021 | 2020 | 2020 | |||||||||||||||||||||||||
Gross premiums written |
$ | 5,456 | $ | 4,545 | $ | 4,780 | $ | 4,841 | $ | 4,401 | $ | 10,001 | $ | 8,612 | $ | 18,233 | ||||||||||||||||
Net premiums written |
4,285 | 3,664 | 3,724 | 3,778 | 3,720 | 7,949 | 6,972 | 14,474 | ||||||||||||||||||||||||
Net premiums earned |
3,803 | 3,674 | 3,537 | 3,456 | 3,595 | 7,477 | 6,971 | 13,964 | ||||||||||||||||||||||||
Losses and loss expenses |
2,426 | 2,560 | 2,006 | 2,444 | 3,498 | 4,986 | 5,679 | 10,129 | ||||||||||||||||||||||||
Policy acquisition costs |
489 | 514 | 490 | 489 | 471 | 1,003 | 963 | 1,942 | ||||||||||||||||||||||||
Administrative expenses |
245 | 254 | 255 | 243 | 249 | 499 | 508 | 1,006 | ||||||||||||||||||||||||
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Underwriting income (loss) |
643 | 346 | 786 | 280 | (623 | ) | 989 | (179 | ) | 887 | ||||||||||||||||||||||
Adjusted net investment income |
535 | 540 | 517 | 510 | 509 | 1,075 | 1,034 | 2,061 | ||||||||||||||||||||||||
Other income (expense) - operating |
(14 | ) | (2 | ) | (4 | ) | (7 | ) | (6 | ) | (16 | ) | (12 | ) | (23 | ) | ||||||||||||||||
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Segment income (loss) |
$ | 1,164 | $ | 884 | $ | 1,299 | $ | 783 | $ | (120 | ) | $ | 2,048 | $ | 843 | $ | 2,925 | |||||||||||||||
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CAY underwriting income ex Cats |
$ | 652 | $ | 581 | $ | 568 | $ | 527 | $ | 504 | $ | 1,233 | $ | 961 | $ | 2,056 | ||||||||||||||||
Combined ratio |
||||||||||||||||||||||||||||||||
Loss and loss expense ratio |
63.8 | % | 69.7 | % | 56.7 | % | 70.7 | % | 97.3 | % | 66.7 | % | 81.5 | % | 72.5 | % | ||||||||||||||||
Policy acquisition cost ratio |
12.9 | % | 14.0 | % | 13.9 | % | 14.2 | % | 13.1 | % | 13.4 | % | 13.8 | % | 14.0 | % | ||||||||||||||||
Administrative expense ratio |
6.4 | % | 6.9 | % | 7.2 | % | 7.0 | % | 6.9 | % | 6.7 | % | 7.3 | % | 7.2 | % | ||||||||||||||||
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Combined ratio |
83.1 | % | 90.6 | % | 77.8 | % | 91.9 | % | 117.3 | % | 86.8 | % | 102.6 | % | 93.7 | % | ||||||||||||||||
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CAY combined ratio ex Cats |
||||||||||||||||||||||||||||||||
CAY loss and loss expense ratio ex Cats |
63.7 | % | 63.4 | % | 62.8 | % | 63.8 | % | 66.1 | % | 63.6 | % | 65.2 | % | 64.2 | % | ||||||||||||||||
CAY policy acquisition cost and administrative expense ratio ex Cats |
19.2 | % | 20.8 | % | 21.1 | % | 21.1 | % | 19.9 | % | 20.0 | % | 21.0 | % | 21.1 | % | ||||||||||||||||
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CAY combined ratio ex Cats |
82.9 | % | 84.2 | % | 83.9 | % | 84.9 | % | 86.0 | % | 83.6 | % | 86.2 | % | 85.3 | % | ||||||||||||||||
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Catastrophe reinstatement premiums expensed - pre-tax |
$ | | $ | | $ | | $ | | $ | (3 | ) | $ | | $ | (3 | ) | $ | (3 | ) | |||||||||||||
Catastrophe losses - pre-tax |
$ | 165 | $ | 362 | $ | 33 | $ | 447 | $ | 1,270 | $ | 527 | $ | 1,388 | $ | 1,868 | ||||||||||||||||
Favorable prior period development (PPD) - pre-tax |
$ | (156 | ) | $ | (127 | ) | $ | (251 | ) | $ | (200 | ) | $ | (146 | ) | $ | (283 | ) | $ | (251 | ) | $ | (702 | ) | ||||||||
% Change versus prior year period |
||||||||||||||||||||||||||||||||
Net premiums written (1) |
15.2 | % | 12.7 | % | 8.3 | % | 9.4 | % | 5.3 | % | 14.0 | % | 7.5 | % | 8.2 | % | ||||||||||||||||
Net premiums written - Commercial |
16.3 | % | 14.7 | % | 10.0 | % | 11.2 | % | 6.9 | % | 15.6 | % | 8.6 | % | 9.6 | % | ||||||||||||||||
Net premiums written - Consumer |
-8.9 | % | -18.5 | % | -19.1 | % | -18.1 | % | -20.3 | % | -14.1 | % | -8.9 | % | -13.8 | % | ||||||||||||||||
Net premiums earned |
5.8 | % | 8.8 | % | 8.4 | % | 8.5 | % | 6.1 | % | 7.3 | % | 7.7 | % | 8.1 | % | ||||||||||||||||
Other ratios |
||||||||||||||||||||||||||||||||
Net premiums written/gross premiums written |
79 | % | 81 | % | 78 | % | 78 | % | 85 | % | 79 | % | 81 | % | 79 | % | ||||||||||||||||
Production by Size - Net premiums written (2) |
||||||||||||||||||||||||||||||||
Major Accounts & Specialty |
$ | 2,622 | $ | 2,140 | $ | 2,229 | $ | 2,294 | $ | 2,350 | $ | 4,762 | $ | 4,224 | $ | 8,747 | ||||||||||||||||
Commercial |
1,663 | 1,524 | 1,495 | 1,484 | 1,370 | 3,187 | 2,748 | 5,727 | ||||||||||||||||||||||||
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Total |
$ | 4,285 | $ | 3,664 | $ | 3,724 | $ | 3,778 | $ | 3,720 | $ | 7,949 | $ | 6,972 | $ | 14,474 | ||||||||||||||||
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(1) | Q2 2021 net premiums written growth was adversely impacted by lower year-over-year large structured transactions written of $241 million, partially offset by the prior year COVID-19 related exposure adjustments of $160 million on in-force policies. Excluding these items, net premiums written increased 18.0% in the quarter and 15.5% YTD. |
(2) | Major Accounts & Specialty: large corporate accounts and wholesale business. Commercial: principally middle market and small commercial accounts. |
NA Commercial | Page 11 |
Chubb Limited
Segment Results - Consecutive Quarters
(in millions of U.S. dollars, except ratios)
(Unaudited)
North America Personal P&C Insurance
YTD | YTD | Full Year | ||||||||||||||||||||||||||||||
2Q-21 | 1Q-21 | 4Q-20 | 3Q-20 | 2Q-20 | 2021 | 2020 | 2020 | |||||||||||||||||||||||||
Gross premiums written |
$ | 1,544 | $ | 1,275 | $ | 1,348 | $ | 1,448 | $ | 1,511 | $ | 2,819 | $ | 2,776 | $ | 5,572 | ||||||||||||||||
Net premiums written |
1,363 | 1,098 | 1,201 | 1,285 | 1,327 | 2,461 | 2,434 | 4,920 | ||||||||||||||||||||||||
Net premiums earned |
1,224 | 1,184 | 1,243 | 1,231 | 1,192 | 2,408 | 2,392 | 4,866 | ||||||||||||||||||||||||
Losses and loss expenses |
676 | 819 | 781 | 961 | 762 | 1,495 | 1,445 | 3,187 | ||||||||||||||||||||||||
Policy acquisition costs |
245 | 247 | 250 | 248 | 231 | 492 | 476 | 974 | ||||||||||||||||||||||||
Administrative expenses |
67 | 60 | 71 | 65 | 66 | 127 | 134 | 270 | ||||||||||||||||||||||||
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Underwriting income (loss) |
236 | 58 | 141 | (43 | ) | 133 | 294 | 337 | 435 | |||||||||||||||||||||||
Net investment income |
64 | 65 | 65 | 64 | 65 | 129 | 131 | 260 | ||||||||||||||||||||||||
Other income (expense) - operating |
5 | (1 | ) | (1 | ) | (1 | ) | (1 | ) | 4 | (3 | ) | (5 | ) | ||||||||||||||||||
Amortization expense of purchased intangibles |
(3 | ) | (3 | ) | (3 | ) | (2 | ) | (3 | ) | (6 | ) | (6 | ) | (11 | ) | ||||||||||||||||
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Segment income |
$ | 302 | $ | 119 | $ | 202 | $ | 18 | $ | 194 | $ | 421 | $ | 459 | $ | 679 | ||||||||||||||||
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CAY underwriting income ex Cats |
$ | 253 | $ | 258 | $ | 254 | $ | 310 | $ | 242 | $ | 511 | $ | 468 | $ | 1,032 | ||||||||||||||||
Combined ratio |
||||||||||||||||||||||||||||||||
Loss and loss expense ratio |
55.2 | % | 69.2 | % | 62.8 | % | 78.1 | % | 63.8 | % | 62.1 | % | 60.4 | % | 65.5 | % | ||||||||||||||||
Policy acquisition cost ratio |
20.0 | % | 20.9 | % | 20.1 | % | 20.1 | % | 19.4 | % | 20.4 | % | 19.9 | % | 20.0 | % | ||||||||||||||||
Administrative expense ratio |
5.5 | % | 5.0 | % | 5.7 | % | 5.3 | % | 5.6 | % | 5.3 | % | 5.6 | % | 5.6 | % | ||||||||||||||||
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Combined ratio |
80.7 | % | 95.1 | % | 88.6 | % | 103.5 | % | 88.8 | % | 87.8 | % | 85.9 | % | 91.1 | % | ||||||||||||||||
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CAY combined ratio ex Cats |
||||||||||||||||||||||||||||||||
CAY loss and loss expense ratio ex Cats |
53.6 | % | 53.2 | % | 53.4 | % | 49.2 | % | 54.7 | % | 53.4 | % | 54.9 | % | 53.1 | % | ||||||||||||||||
CAY policy acquisition cost and administrative expense ratio ex Cats |
25.6 | % | 25.4 | % | 25.9 | % | 25.6 | % | 24.9 | % | 25.5 | % | 25.5 | % | 25.6 | % | ||||||||||||||||
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|||||||||||||||||
CAY combined ratio ex Cats |
79.2 | % | 78.6 | % | 79.3 | % | 74.8 | % | 79.6 | % | 78.9 | % | 80.4 | % | 78.7 | % | ||||||||||||||||
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Catastrophe reinstatement premiums (expensed) collected - pre-tax |
$ | 7 | $ | (23 | ) | $ | | $ | | $ | (1 | ) | $ | (16 | ) | $ | (1 | ) | $ | (1 | ) | |||||||||||
Catastrophe losses - pre-tax |
$ | 68 | $ | 217 | $ | 98 | $ | 305 | $ | 109 | $ | 285 | $ | 130 | $ | 533 | ||||||||||||||||
Unfavorable (favorable) prior period development (PPD) - pre-tax |
$ | (44 | ) | $ | (40 | ) | $ | 15 | $ | 48 | $ | (1 | ) | $ | (84 | ) | $ | | $ | 63 | ||||||||||||
% Change versus prior year period |
||||||||||||||||||||||||||||||||
Net premiums written |
2.6 | % | -0.8 | % | 2.5 | % | 2.8 | % | 1.4 | % | 1.1 | % | 2.9 | % | 2.8 | % | ||||||||||||||||
Net premiums earned |
2.7 | % | -1.3 | % | 4.9 | % | 3.8 | % | 2.1 | % | 0.7 | % | 3.0 | % | 3.7 | % | ||||||||||||||||
Other ratios |
||||||||||||||||||||||||||||||||
Net premiums written/gross premiums written |
88 | % | 86 | % | 89 | % | 89 | % | 88 | % | 87 | % | 88 | % | 88 | % |
NA Personal | Page 12 |
Chubb Limited
Segment Results - Consecutive Quarters
(in millions of U.S. dollars, except ratios)
(Unaudited)
North America Agricultural Insurance
YTD | YTD | Full Year | ||||||||||||||||||||||||||||||
2Q-21 | 1Q-21 | 4Q-20 | 3Q-20 | 2Q-20 | 2021 | 2020 | 2020 | |||||||||||||||||||||||||
Gross premiums written |
$ | 706 | $ | 266 | $ | 312 | $ | 1,332 | $ | 652 | $ | 972 | $ | 872 | $ | 2,516 | ||||||||||||||||
Net premiums written |
512 | 183 | 242 | 986 | 461 | 695 | 618 | 1,846 | ||||||||||||||||||||||||
Net premiums earned |
410 | 110 | 381 | 971 | 376 | 520 | 470 | 1,822 | ||||||||||||||||||||||||
Adjusted losses and loss expenses (1) |
331 | 85 | 321 | 845 | 313 | 416 | 378 | 1,544 | ||||||||||||||||||||||||
Policy acquisition costs |
27 | 12 | 27 | 56 | 29 | 39 | 40 | 123 | ||||||||||||||||||||||||
Administrative expenses |
3 | 3 | (3 | ) | 5 | 3 | 6 | 7 | 9 | |||||||||||||||||||||||
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Underwriting income |
49 | 10 | 36 | 65 | 31 | 59 | 45 | 146 | ||||||||||||||||||||||||
Net investment income |
8 | 7 | 7 | 7 | 7 | 15 | 16 | 30 | ||||||||||||||||||||||||
Other income (expense) - operating |
| | | | (1 | ) | | (1 | ) | (1 | ) | |||||||||||||||||||||
Amortization expense of purchased intangibles |
(6 | ) | (7 | ) | (7 | ) | (7 | ) | (6 | ) | (13 | ) | (13 | ) | (27 | ) | ||||||||||||||||
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Segment income |
$ | 51 | $ | 10 | $ | 36 | $ | 65 | $ | 31 | $ | 61 | $ | 47 | $ | 148 | ||||||||||||||||
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CAY underwriting income ex Cats |
$ | 53 | $ | 16 | $ | 34 | $ | 93 | $ | 37 | $ | 69 | $ | 45 | $ | 172 | ||||||||||||||||
Combined ratio |
||||||||||||||||||||||||||||||||
Loss and loss expense ratio |
80.7 | % | 77.5 | % | 84.1 | % | 87.1 | % | 83.1 | % | 80.0 | % | 80.4 | % | 84.7 | % | ||||||||||||||||
Policy acquisition cost ratio |
6.7 | % | 10.7 | % | 7.0 | % | 5.8 | % | 7.8 | % | 7.6 | % | 8.5 | % | 6.8 | % | ||||||||||||||||
Administrative expense ratio |
0.7 | % | 2.7 | % | -0.6 | % | 0.4 | % | 0.9 | % | 1.1 | % | 1.5 | % | 0.5 | % | ||||||||||||||||
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Combined ratio |
88.1 | % | 90.9 | % | 90.5 | % | 93.3 | % | 91.8 | % | 88.7 | % | 90.4 | % | 92.0 | % | ||||||||||||||||
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CAY combined ratio ex Cats |
||||||||||||||||||||||||||||||||
CAY loss and loss expense ratio ex Cats |
79.7 | % | 71.2 | % | 86.3 | % | 84.2 | % | 81.5 | % | 77.9 | % | 80.4 | % | 83.7 | % | ||||||||||||||||
CAY policy acquisition cost and administrative expense ratio ex Cats |
7.4 | % | 13.5 | % | 4.8 | % | 6.2 | % | 8.7 | % | 8.7 | % | 10.0 | % | 6.8 | % | ||||||||||||||||
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|||||||||||||||||
CAY combined ratio ex Cats |
87.1 | % | 84.7 | % | 91.1 | % | 90.4 | % | 90.2 | % | 86.6 | % | 90.4 | % | 90.5 | % | ||||||||||||||||
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Catastrophe reinstatement premiums expensed - pre-tax |
$ | | $ | | $ | (1 | ) | $ | | $ | | $ | | $ | | $ | (1 | ) | ||||||||||||||
Catastrophe losses - pre-tax |
$ | 4 | $ | 8 | $ | 11 | $ | 10 | $ | 6 | $ | 12 | $ | 14 | $ | 35 | ||||||||||||||||
Unfavorable (favorable) prior period development (PPD) - pre-tax |
$ | | $ | (2 | ) | $ | (14 | ) | $ | 18 | $ | | $ | (2 | ) | $ | (14 | ) | $ | (10 | ) | |||||||||||
% Change versus prior year period |
||||||||||||||||||||||||||||||||
Net premiums written |
11.0 | % | 16.5 | % | -12.2 | % | 5.0 | % | -1.1 | % | 12.4 | % | 3.8 | % | 2.0 | % | ||||||||||||||||
Net premiums earned |
8.9 | % | 16.7 | % | -9.4 | % | 3.2 | % | -0.5 | % | 10.5 | % | 8.6 | % | 1.5 | % | ||||||||||||||||
Other ratios |
||||||||||||||||||||||||||||||||
Net premiums written/gross premiums written |
72 | % | 69 | % | 78 | % | 74 | % | 71 | % | 71 | % | 71 | % | 73 | % |
(1) | Includes Realized gains (losses) on crop derivatives. |
NA Agriculture | Page 13 |
Chubb Limited
Segment Results - Consecutive Quarters
(in millions of U.S. dollars, except ratios)
(Unaudited)
Overseas General Insurance
YTD | YTD | Full Year | ||||||||||||||||||||||||||||||
2Q-21 | 1Q-21 | 4Q-20 | 3Q-20 | 2Q-20 | 2021 | 2020 | 2020 | |||||||||||||||||||||||||
Gross premiums written |
$ | 3,166 | $ | 3,574 | $ | 3,001 | $ | 2,756 | $ | 2,561 | $ | 6,740 | $ | 5,692 | $ | 11,449 | ||||||||||||||||
Net premiums written |
2,497 | 2,890 | 2,478 | 2,238 | 2,021 | 5,387 | 4,619 | 9,335 | ||||||||||||||||||||||||
Net premiums earned |
2,579 | 2,478 | 2,447 | 2,337 | 2,194 | 5,057 | 4,501 | 9,285 | ||||||||||||||||||||||||
Losses and loss expenses |
1,186 | 1,263 | 1,320 | 1,192 | 1,485 | 2,449 | 2,743 | 5,255 | ||||||||||||||||||||||||
Policy acquisition costs |
699 | 668 | 665 | 637 | 624 | 1,367 | 1,266 | 2,568 | ||||||||||||||||||||||||
Administrative expenses |
279 | 266 | 275 | 260 | 241 | 545 | 499 | 1,034 | ||||||||||||||||||||||||
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Underwriting income (loss) |
415 | 281 | 187 | 248 | (156 | ) | 696 | (7 | ) | 428 | ||||||||||||||||||||||
Adjusted net investment income |
149 | 141 | 138 | 130 | 121 | 290 | 266 | 534 | ||||||||||||||||||||||||
Other income (expense) - operating |
(2 | ) | (1 | ) | (3 | ) | (1 | ) | (5 | ) | (3 | ) | (9 | ) | (13 | ) | ||||||||||||||||
Amortization expense of purchased intangibles |
(13 | ) | (12 | ) | (12 | ) | (10 | ) | (11 | ) | (25 | ) | (23 | ) | (45 | ) | ||||||||||||||||
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Segment income (loss) |
$ | 549 | $ | 409 | $ | 310 | $ | 367 | $ | (51 | ) | $ | 958 | $ | 227 | $ | 904 | |||||||||||||||
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|||||||||||||||||
CAY underwriting income ex Cats |
$ | 299 | $ | 306 | $ | 258 | $ | 283 | $ | 207 | $ | 605 | $ | 442 | $ | 983 | ||||||||||||||||
Combined ratio |
||||||||||||||||||||||||||||||||
Loss and loss expense ratio |
46.0 | % | 51.0 | % | 53.9 | % | 51.0 | % | 67.7 | % | 48.4 | % | 61.0 | % | 56.6 | % | ||||||||||||||||
Policy acquisition cost ratio |
27.1 | % | 27.0 | % | 27.2 | % | 27.3 | % | 28.4 | % | 27.0 | % | 28.1 | % | 27.7 | % | ||||||||||||||||
Administrative expense ratio |
10.8 | % | 10.7 | % | 11.3 | % | 11.1 | % | 11.0 | % | 10.8 | % | 11.1 | % | 11.1 | % | ||||||||||||||||
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Combined ratio |
83.9 | % | 88.7 | % | 92.4 | % | 89.4 | % | 107.1 | % | 86.2 | % | 100.2 | % | 95.4 | % | ||||||||||||||||
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|||||||||||||||||
CAY combined ratio ex Cats |
||||||||||||||||||||||||||||||||
CAY loss and loss expense ratio ex Cats |
50.6 | % | 49.9 | % | 51.0 | % | 49.5 | % | 51.6 | % | 50.3 | % | 51.2 | % | 50.7 | % | ||||||||||||||||
CAY policy acquisition cost and administrative expense ratio ex Cats |
37.8 | % | 37.7 | % | 38.5 | % | 38.4 | % | 39.1 | % | 37.8 | % | 39.0 | % | 38.7 | % | ||||||||||||||||
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|||||||||||||||||
CAY combined ratio ex Cats |
88.4 | % | 87.6 | % | 89.5 | % | 87.9 | % | 90.7 | % | 88.1 | % | 90.2 | % | 89.4 | % | ||||||||||||||||
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Catastrophe reinstatement premiums (expensed) collected - pre-tax |
$ | | $ | | $ | 1 | $ | | $ | (16 | ) | $ | | $ | (16 | ) | $ | (15 | ) | |||||||||||||
Catastrophe losses - pre-tax |
$ | 40 | $ | 50 | $ | 122 | $ | 95 | $ | 383 | $ | 90 | $ | 473 | $ | 690 | ||||||||||||||||
Favorable prior period development (PPD) - pre-tax |
$ | (156 | ) | $ | (25 | ) | $ | (50 | ) | $ | (60 | ) | $ | (36 | ) | $ | (181 | ) | $ | (40 | ) | $ | (150 | ) | ||||||||
% Change versus prior year period |
||||||||||||||||||||||||||||||||
Net premiums written |
23.6 | % | 11.2 | % | 4.1 | % | 0.5 | % | -10.5 | % | 16.6 | % | -0.7 | % | 0.8 | % | ||||||||||||||||
Net premiums written - Commercial |
32.4 | % | 20.3 | % | 14.2 | % | 10.4 | % | -1.6 | % | 25.4 | % | 5.8 | % | 9.1 | % | ||||||||||||||||
Net premiums written - Consumer |
12.8 | % | -1.3 | % | -8.0 | % | -10.9 | % | -19.6 | % | 5.1 | % | -8.3 | % | -8.9 | % | ||||||||||||||||
Net premiums earned |
17.6 | % | 7.4 | % | 7.0 | % | 3.6 | % | -1.5 | % | 12.4 | % | 3.7 | % | 4.5 | % | ||||||||||||||||
Net premiums written constant $ |
15.0 | % | 7.1 | % | 3.3 | % | 2.8 | % | -5.1 | % | 10.6 | % | 2.7 | % | 2.9 | % | ||||||||||||||||
Net premiums written - Commercial |
23.4 | % | 15.2 | % | 12.6 | % | 12.2 | % | 3.5 | % | 18.8 | % | 9.1 | % | 10.8 | % | ||||||||||||||||
Net premiums written - Consumer |
4.6 | % | -4.2 | % | -8.1 | % | -8.1 | % | -14.0 | % | -0.1 | % | -4.7 | % | -6.4 | % | ||||||||||||||||
Net premiums earned constant $ |
9.1 | % | 3.7 | % | 6.0 | % | 5.7 | % | 4.2 | % | 6.4 | % | 7.4 | % | 6.6 | % | ||||||||||||||||
Other ratios: Net premiums written/gross premiums written |
79 | % | 81 | % | 83 | % | 81 | % | 79 | % | 80 | % | 81 | % | 82 | % | ||||||||||||||||
Production by Region - Net premiums written | 2Q-21 | 2Q-20 | % Change | Constant $ % Change |
YTD 2021 |
YTD 2020 |
% Change | Constant $ % Change |
||||||||||||||||||||||||
Europe, Middle East and Africa |
$ | 1,188 | $ | 879 | 35.2 | % | 25.6 | % | $ | 2,739 | $ | 2,156 | 27.1 | % | 18.7 | % | ||||||||||||||||
Latin America |
451 | 389 | 16.3 | % | 8.2 | % | 988 | 972 | 1.7 | % | 1.4 | % | ||||||||||||||||||||
Asia |
825 | 721 | 14.4 | % | 6.7 | % | 1,586 | 1,409 | 12.5 | % | 5.7 | % | ||||||||||||||||||||
Other (1) |
33 | 32 | 1.9 | % | -6.5 | % | 74 | 82 | -10.3 | % | -15.5 | % | ||||||||||||||||||||
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Total |
$ | 2,497 | $ | 2,021 | 23.6 | % | 15.0 | % | $ | 5,387 | $ | 4,619 | 16.6 | % | 10.6 | % | ||||||||||||||||
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(1) | Includes the companys international supplemental A&H business of Combined Insurance and other international operations. |
Overseas General Insurance | Page 14 |
Chubb Limited
Segment Results - Consecutive Quarters
(in millions of U.S. dollars, except ratios)
(Unaudited)
Global Reinsurance
YTD | YTD | Full Year | ||||||||||||||||||||||||||||||
2Q-21 | 1Q-21 | 4Q-20 | 3Q-20 | 2Q-20 | 2021 | 2020 | 2020 | |||||||||||||||||||||||||
Gross premiums written |
$ | 336 | $ | 230 | $ | 130 | $ | 198 | $ | 262 | $ | 566 | $ | 504 | $ | 832 | ||||||||||||||||
Net premiums written |
274 | 207 | 125 | 181 | 207 | 481 | 425 | 731 | ||||||||||||||||||||||||
Net premiums earned |
192 | 180 | 178 | 171 | 163 | 372 | 349 | 698 | ||||||||||||||||||||||||
Losses and loss expenses |
110 | 120 | 121 | 154 | 73 | 230 | 160 | 435 | ||||||||||||||||||||||||
Policy acquisition costs |
47 | 45 | 47 | 40 | 42 | 92 | 87 | 174 | ||||||||||||||||||||||||
Administrative expenses |
10 | 8 | 9 | 9 | 9 | 18 | 19 | 37 | ||||||||||||||||||||||||
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Underwriting income (loss) |
25 | 7 | 1 | (32 | ) | 39 | 32 | 83 | 52 | |||||||||||||||||||||||
Adjusted net investment income |
81 | 70 | 93 | 85 | 60 | 151 | 129 | 307 | ||||||||||||||||||||||||
Other income (expense) - operating |
| | (1 | ) | | (1 | ) | | (1 | ) | (2 | ) | ||||||||||||||||||||
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Segment income |
$ | 106 | $ | 77 | $ | 93 | $ | 53 | $ | 98 | $ | 183 | $ | 211 | $ | 357 | ||||||||||||||||
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CAY underwriting income ex Cats |
$ | 35 | $ | 40 | $ | 33 | $ | 30 | $ | 36 | $ | 75 | $ | 73 | $ | 136 | ||||||||||||||||
Combined ratio |
||||||||||||||||||||||||||||||||
Loss and loss expense ratio |
56.8 | % | 66.9 | % | 68.3 | % | 89.6 | % | 45.5 | % | 61.7 | % | 46.0 | % | 62.3 | % | ||||||||||||||||
Policy acquisition cost ratio |
24.7 | % | 24.9 | % | 25.9 | % | 23.5 | % | 25.5 | % | 24.8 | % | 25.0 | % | 24.9 | % | ||||||||||||||||
Administrative expense ratio |
5.1 | % | 4.6 | % | 5.4 | % | 5.2 | % | 5.6 | % | 4.8 | % | 5.3 | % | 5.3 | % | ||||||||||||||||
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|
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Combined ratio |
86.6 | % | 96.4 | % | 99.6 | % | 118.3 | % | 76.6 | % | 91.3 | % | 76.3 | % | 92.5 | % | ||||||||||||||||
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|||||||||||||||||
CAY combined ratio ex Cats |
||||||||||||||||||||||||||||||||
CAY loss and loss expense ratio ex Cats |
50.9 | % | 48.3 | % | 49.3 | % | 49.7 | % | 46.8 | % | 49.6 | % | 48.7 | % | 49.1 | % | ||||||||||||||||
CAY policy acquisition cost and administrative expense ratio ex Cats |
30.3 | % | 29.7 | % | 32.0 | % | 31.1 | % | 31.4 | % | 30.0 | % | 30.5 | % | 31.0 | % | ||||||||||||||||
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|
|||||||||||||||||
CAY combined ratio ex Cats |
81.2 | % | 78.0 | % | 81.3 | % | 80.8 | % | 78.2 | % | 79.6 | % | 79.2 | % | 80.1 | % | ||||||||||||||||
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|||||||||||||||||
Catastrophe reinstatement premiums collected - pre-tax |
$ | 1 | $ | 5 | $ | 3 | $ | 7 | $ | | $ | 6 | $ | | $ | 10 | ||||||||||||||||
Catastrophe losses - pre-tax |
$ | 11 | $ | 45 | $ | 35 | $ | 75 | $ | 13 | $ | 56 | $ | 13 | $ | 123 | ||||||||||||||||
Favorable prior period development (PPD) - pre-tax |
$ | | $ | (7 | ) | $ | | $ | (6 | ) | $ | (16 | ) | $ | (7 | ) | $ | (23 | ) | $ | (29 | ) | ||||||||||
% Change versus prior year period |
||||||||||||||||||||||||||||||||
Net premiums written as reported |
32.4 | % | -5.1 | % | 14.4 | % | 28.4 | % | 4.6 | % | 13.1 | % | 6.5 | % | 12.6 | % | ||||||||||||||||
Net premiums earned as reported |
17.8 | % | -3.3 | % | 6.5 | % | 6.7 | % | 2.9 | % | 6.6 | % | 6.8 | % | 6.7 | % | ||||||||||||||||
Net premiums written constant $ |
30.7 | % | -6.2 | % | 12.9 | % | 27.2 | % | 4.9 | % | 11.7 | % | 6.4 | % | 12.1 | % | ||||||||||||||||
Net premiums earned constant $ |
15.1 | % | -4.3 | % | 5.1 | % | 5.4 | % | 4.0 | % | 4.8 | % | 7.2 | % | 6.2 | % | ||||||||||||||||
Other ratios |
||||||||||||||||||||||||||||||||
Net premiums written/gross premiums written |
81 | % | 90 | % | 96 | % | 91 | % | 79 | % | 85 | % | 84 | % | 88 | % |
Global Reinsurance | Page 15 |
Chubb Limited
Segment Results - Consecutive Quarters
(in millions of U.S. dollars)
(Unaudited)
Life Insurance
YTD | YTD | Full Year | ||||||||||||||||||||||||||||||
2Q-21 | 1Q-21 | 4Q-20 | 3Q-20 | 2Q-20 | 2021 | 2020 | 2020 | |||||||||||||||||||||||||
Gross premiums written |
$ | 652 | $ | 655 | $ | 678 | $ | 645 | $ | 653 | $ | 1,307 | $ | 1,336 | $ | 2,659 | ||||||||||||||||
Net premiums written |
615 | 620 | 640 | 610 | 619 | 1,235 | 1,264 | 2,514 | ||||||||||||||||||||||||
Net premiums earned |
605 | 595 | 644 | 599 | 608 | 1,200 | 1,239 | 2,482 | ||||||||||||||||||||||||
Losses and loss expenses |
185 | 198 | 168 | 183 | 171 | 383 | 373 | 724 | ||||||||||||||||||||||||
Adjusted policy benefits |
170 | 163 | 184 | 174 | 183 | 333 | 368 | 726 | ||||||||||||||||||||||||
Policy acquisition costs |
191 | 179 | 215 | 175 | 196 | 370 | 376 | 766 | ||||||||||||||||||||||||
Administrative expenses |
83 | 82 | 82 | 80 | 82 | 165 | 158 | 320 | ||||||||||||||||||||||||
Net investment income |
101 | 98 | 100 | 95 | 95 | 199 | 190 | 385 | ||||||||||||||||||||||||
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Life Insurance underwriting income (1) |
77 | 71 | 95 | 82 | 71 | 148 | 154 | 331 | ||||||||||||||||||||||||
Other income (expense) - operating |
26 | 34 | 22 | 23 | 17 | 60 | 29 | 74 | ||||||||||||||||||||||||
Amortization expense of purchased intangibles |
(1 | ) | (1 | ) | (1 | ) | (1 | ) | (1 | ) | (2 | ) | (2 | ) | (4 | ) | ||||||||||||||||
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Segment income |
$ | 102 | $ | 104 | $ | 116 | $ | 104 | $ | 87 | $ | 206 | $ | 181 | $ | 401 | ||||||||||||||||
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% Change versus prior year period |
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Net premiums written |
-0.7 | % | -3.8 | % | 3.0 | % | -0.4 | % | 7.0 | % | -2.3 | % | 9.2 | % | 5.1 | % | ||||||||||||||||
Net premiums earned |
-0.4 | % | -5.7 | % | 5.0 | % | 0.0 | % | 6.5 | % | -3.1 | % | 9.5 | % | 5.9 | % | ||||||||||||||||
Net premiums written constant $ |
-4.0 | % | -4.7 | % | 3.1 | % | 0.2 | % | 8.5 | % | -4.3 | % | 9.9 | % | 5.6 | % | ||||||||||||||||
Net premiums earned constant $ |
-3.7 | % | -6.7 | % | 5.2 | % | 0.7 | % | 8.0 | % | -5.2 | % | 10.2 | % | 6.5 | % | ||||||||||||||||
(1) We assess the performance of our Life Insurance business based on Life Insurance underwriting income which includes Net investment income and (Gains) losses from fair value changes in separate account assets.
International life insurance net premiums written and deposits breakdown (excludes Combined North America and Life reinsurance businesses):
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Constant $ | YTD | YTD | Constant $ | |||||||||||||||||||||||||||||
2Q-21 | 2Q-20 | % Change | % Change | 2021 | 2020 | % Change | % Change | |||||||||||||||||||||||||
International life insurance net premiums written |
$ | 324 | $ | 290 | 11.6 | % | 6.3 | % | $ | 648 | $ | 585 | 10.7 | % | 7.2 | % | ||||||||||||||||
International life insurance deposits (2) |
605 | 309 | 95.8 | % | 86.9 | % | 1,156 | 752 | 53.7 | % | 45.7 | % | ||||||||||||||||||||
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Total international life insurance net premiums written and deposits |
$ | 929 | $ | 599 | 55.0 | % | 47.8 | % | $ | 1,804 | $ | 1,337 | 34.9 | % | 29.1 | % | ||||||||||||||||
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International life insurance segment income |
$ | 35 | $ | 37 | -6.2 | % | -6.8 | % | $ | 87 | $ | 82 | 5.8 | % | 4.8 | % | ||||||||||||||||
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(2) | Includes deposits collected on universal life and investment contracts. Consistent with GAAP, premiums collected on universal life and investment contracts are considered deposits and excluded from revenues. |
Life Insurance | Page 16 |
Chubb Limited
Segment Results - Consecutive Quarters
(in millions of U.S. dollars)
(Unaudited)
Corporate
YTD | YTD | Full Year | ||||||||||||||||||||||||||||||
2Q-21 | 1Q-21 | 4Q-20 | 3Q-20 | 2Q-20 | 2021 | 2020 | 2020 | |||||||||||||||||||||||||
Gross premiums written |
$ | | $ | | $ | | $ | | $ | | $ | | $ | | $ | | ||||||||||||||||
Net premiums written |
| | | | | | | | ||||||||||||||||||||||||
Net premiums earned |
| | | | | | | | ||||||||||||||||||||||||
Losses and loss expenses (1) |
89 | 9 | 93 | 55 | 276 | 98 | 287 | 435 | ||||||||||||||||||||||||
Policy acquisition costs |
| | | | | | | | ||||||||||||||||||||||||
Administrative expenses |
88 | 71 | 89 | 71 | 77 | 159 | 143 | 303 | ||||||||||||||||||||||||
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Underwriting loss |
(177 | ) | (80 | ) | (182 | ) | (126 | ) | (353 | ) | (257 | ) | (430 | ) | (738 | ) | ||||||||||||||||
Adjusted net investment income |
7 | 9 | 4 | 9 | 8 | 16 | 16 | 29 | ||||||||||||||||||||||||
Other income (expense) - operating |
(2 | ) | (4 | ) | 2 | (7 | ) | (9 | ) | (6 | ) | (25 | ) | (30 | ) | |||||||||||||||||
Adjusted interest expense |
(127 | ) | (127 | ) | (131 | ) | (135 | ) | (134 | ) | (254 | ) | (271 | ) | (537 | ) | ||||||||||||||||
Amortization expense of purchased intangibles |
(50 | ) | (49 | ) | (50 | ) | (52 | ) | (51 | ) | (99 | ) | (101 | ) | (203 | ) | ||||||||||||||||
Income tax (expense) benefit |
(304 | ) | (210 | ) | (259 | ) | (172 | ) | 46 | (514 | ) | (191 | ) | (622 | ) | |||||||||||||||||
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Core operating loss |
(653 | ) | (461 | ) | (616 | ) | (483 | ) | (493 | ) | (1,114 | ) | (1,002 | ) | (2,101 | ) | ||||||||||||||||
Amortization of fair value adjustment of acquired invested assets and long-term debt, net of tax |
(14 | ) | (16 | ) | (18 | ) | (19 | ) | (19 | ) | (30 | ) | (41 | ) | (78 | ) | ||||||||||||||||
Adjusted net realized gains (losses), net of tax (2) |
658 | 1,174 | 996 | 306 | (58 | ) | 1,832 | (1,004 | ) | 298 | ||||||||||||||||||||||
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Net income (loss) |
$ | (9 | ) | $ | 697 | $ | 362 | $ | (196 | ) | $ | (570 | ) | $ | 688 | $ | (2,047 | ) | $ | (1,881 | ) | |||||||||||
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Unfavorable prior period development (PPD) - pre-tax |
$ | 88 | $ | 9 | $ | 94 | $ | 54 | $ | 274 | $ | 97 | $ | 285 | $ | 433 |
(1) | Q2 and YTD 2021 includes $68 million of unfavorable PPD for legacy exposures for molestation claims, compared with $254 million prior year. Excluded from this amount is $5 million recorded in the North America Commercial P&C Insurance segment in Q2 and YTD 2020. |
(2) | Includes Net realized gains (losses) related to unconsolidated entities. |
Corporate | Page 17 |
Chubb Limited
Loss Reserve Rollforward
(in millions of U.S. dollars, except ratios)
(Unaudited)
Unpaid Losses | Net Paid to | |||||||||||||||
Gross | Ceded | Net | Incurred Ratio | |||||||||||||
Balance at December 31, 2019 |
$ | 62,690 | $ | 14,181 | $ | 48,509 | ||||||||||
Losses and loss expenses incurred |
5,569 | 1,084 | 4,485 | |||||||||||||
Losses and loss expenses paid |
(5,345 | ) | (1,090 | ) | (4,255 | ) | 95 | % | ||||||||
Other (incl. foreign exch. revaluation) |
(700 | ) | (135 | ) | (565 | ) | ||||||||||
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Balance at March 31, 2020 |
$ | 62,214 | $ | 14,040 | $ | 48,174 | ||||||||||
Losses and loss expenses incurred |
7,825 | 1,248 | 6,577 | |||||||||||||
Losses and loss expenses paid |
(4,874 | ) | (1,024 | ) | (3,850 | ) | 59 | % | ||||||||
Other (incl. foreign exch. revaluation) |
534 | 97 | 437 | |||||||||||||
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Balance at June 30, 2020 |
$ | 65,699 | $ | 14,361 | $ | 51,338 | ||||||||||
Losses and loss expenses incurred |
7,288 | 1,453 | 5,835 | |||||||||||||
Losses and loss expenses paid |
(5,342 | ) | (1,084 | ) | (4,258 | ) | 73 | % | ||||||||
Other (incl. foreign exch. revaluation) |
260 | 37 | 223 | |||||||||||||
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Balance at September 30, 2020 |
$ | 67,905 | $ | 14,767 | $ | 53,138 | ||||||||||
Losses and loss expenses incurred |
6,029 | 1,216 | 4,813 | |||||||||||||
Losses and loss expenses paid |
(6,492 | ) | (1,421 | ) | (5,071 | ) | 105 | % | ||||||||
Other (incl. foreign exch. revaluation) |
369 | 85 | 284 | |||||||||||||
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Balance at December 31, 2020 |
$ | 67,811 | $ | 14,647 | $ | 53,164 | ||||||||||
Losses and loss expenses incurred |
6,467 | 1,414 | 5,053 | |||||||||||||
Losses and loss expenses paid |
(5,100 | ) | (1,207 | ) | (3,893 | ) | 77 | % | ||||||||
Other (incl. foreign exch. revaluation) |
77 | 6 | 71 | |||||||||||||
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Balance at March 31, 2021 |
$ | 69,255 | $ | 14,860 | $ | 54,395 | ||||||||||
Losses and loss expenses incurred |
5,898 | 892 | 5,006 | |||||||||||||
Losses and loss expenses paid |
(5,100 | ) | (1,107 | ) | (3,993 | ) | 80 | % | ||||||||
Other (incl. foreign exch. revaluation) |
236 | 76 | 160 | |||||||||||||
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Balance at June 30, 2021 |
$ | 70,289 | $ | 14,721 | $ | 55,568 | ||||||||||
Add net recoverable on paid losses |
| 1,004 | (1,004 | ) | ||||||||||||
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Balance including net recoverable on paid losses |
$ | 70,289 | $ | 15,725 | $ | 54,564 | ||||||||||
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Loss Reserve Rollforward | Page 18 |
Chubb Limited
Reinsurance Recoverable Analysis
(in millions of U.S. dollars)
(Unaudited)
Net Reinsurance Recoverable by Division
June 30 | March 31 | December 31 | ||||||||||
2021 | 2021 | 2020 | ||||||||||
Reinsurance recoverable on paid losses and loss expenses |
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Active operations |
$ | 885 | $ | 915 | $ | 789 | ||||||
Brandywine and Other Run-off |
176 | 198 | 213 | |||||||||
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Total |
$ | 1,061 | $ | 1,113 | $ | 1,002 | ||||||
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Reinsurance recoverable on unpaid losses and loss expenses |
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Active operations |
$ | 13,707 | $ | 13,868 | $ | 13,629 | ||||||
Brandywine and Other Run-off |
1,279 | 1,250 | 1,275 | |||||||||
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Total |
$ | 14,986 | $ | 15,118 | $ | 14,904 | ||||||
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Gross reinsurance recoverable |
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Active operations |
$ | 14,592 | $ | 14,783 | $ | 14,418 | ||||||
Brandywine and Other Run-off |
1,455 | 1,448 | 1,488 | |||||||||
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Total |
$ | 16,047 | $ | 16,231 | $ | 15,906 | ||||||
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Provision for uncollectible reinsurance (1) |
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Active operations |
$ | (187 | ) | $ | (181 | ) | $ | (178 | ) | |||
Brandywine and Other Run-off |
(135 | ) | (136 | ) | (136 | ) | ||||||
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Total |
$ | (322 | ) | $ | (317 | ) | $ | (314 | ) | |||
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Net reinsurance recoverable |
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Active operations |
$ | 14,405 | $ | 14,602 | $ | 14,240 | ||||||
Brandywine and Other Run-off |
1,320 | 1,312 | 1,352 | |||||||||
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Total |
$ | 15,725 | $ | 15,914 | $ | 15,592 | ||||||
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(1) | The provision for uncollectible reinsurance is based on a default analysis applied to gross reinsurance, net of usable collateral of approximately $3.5 billion. |
Reinsurance Recoverable | Page 19 |
Chubb Limited
Investment Portfolio
(in millions of U.S. dollars)
(Unaudited)
June 30 | March 31 | December 31 | ||||||||||||||||||||||
2021 | 2021 | 2020 | ||||||||||||||||||||||
Market Value |
||||||||||||||||||||||||
Fixed maturities available for sale |
$ | 92,163 | $ | 91,071 | $ | 90,699 | ||||||||||||||||||
Fixed maturities held to maturity |
11,343 | 11,752 | 12,510 | |||||||||||||||||||||
Short-term investments |
4,470 | 3,735 | 4,345 | |||||||||||||||||||||
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Total fixed maturities |
$ | 107,976 | $ | 106,558 | $ | 107,554 | ||||||||||||||||||
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Asset Allocation by Market Value |
||||||||||||||||||||||||
U.S. Treasury / Agency |
$ | 3,560 | 3 | % | $ | 3,724 | 3 | % | $ | 4,122 | 4 | % | ||||||||||||
Corporate and asset-backed securities |
39,889 | 37 | % | 38,711 | 36 | % | 38,769 | 36 | % | |||||||||||||||
Mortgage-backed securities |
21,445 | 20 | % | 21,434 | 20 | % | 20,616 | 19 | % | |||||||||||||||
Municipal |
10,834 | 10 | % | 11,437 | 11 | % | 11,943 | 11 | % | |||||||||||||||
Non-U.S. |
27,778 | 26 | % | 27,517 | 26 | % | 27,759 | 26 | % | |||||||||||||||
Short-term investments |
4,470 | 4 | % | 3,735 | 4 | % | 4,345 | 4 | % | |||||||||||||||
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Total fixed maturities |
$ | 107,976 | 100 | % | $ | 106,558 | 100 | % | $ | 107,554 | 100 | % | ||||||||||||
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Credit Quality by Market Value |
||||||||||||||||||||||||
AAA |
$ | 16,274 | 15 | % | $ | 15,462 | 15 | % | $ | 15,622 | 15 | % | ||||||||||||
AA |
35,412 | 33 | % | 35,930 | 33 | % | 36,125 | 33 | % | |||||||||||||||
A |
19,720 | 18 | % | 19,420 | 18 | % | 19,712 | 18 | % | |||||||||||||||
BBB |
17,479 | 16 | % | 17,214 | 16 | % | 17,542 | 16 | % | |||||||||||||||
BB |
9,495 | 9 | % | 9,308 | 9 | % | 9,699 | 9 | % | |||||||||||||||
B |
9,004 | 8 | % | 8,646 | 8 | % | 8,267 | 8 | % | |||||||||||||||
Other |
592 | 1 | % | 578 | 1 | % | 587 | 1 | % | |||||||||||||||
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Total fixed maturities |
$ | 107,976 | 100 | % | $ | 106,558 | 100 | % | $ | 107,554 | 100 | % | ||||||||||||
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Cost/Amortized Cost, net |
||||||||||||||||||||||||
Fixed maturities available for sale |
$ | 88,254 | $ | 87,858 | $ | 85,168 | ||||||||||||||||||
Fixed maturities held to maturity |
10,673 | 11,132 | 11,653 | |||||||||||||||||||||
Short-term investments |
4,471 | 3,736 | 4,349 | |||||||||||||||||||||
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Subtotal fixed maturities (1) |
103,398 | 102,726 | 101,170 | |||||||||||||||||||||
Equity securities |
4,607 | 4,405 | 4,027 | |||||||||||||||||||||
Other investments |
9,457 | 8,636 | 7,945 | |||||||||||||||||||||
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Total investment portfolio |
$ | 117,462 | $ | 115,767 | $ | 113,142 | ||||||||||||||||||
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Avg. duration of fixed maturities |
4.2 years | 4.3 years | 4.0 years | |||||||||||||||||||||
Avg. market yield of fixed maturities |
2.0 | % | 2.1 | % | 1.7 | % | ||||||||||||||||||
Avg. credit quality |
A/Aa | A/Aa | A/Aa | |||||||||||||||||||||
Avg. yield on invested assets (2) |
3.2 | % | 3.2 | % | 3.3 | % |
(1) | Net of valuation allowance for expected credit losses. |
(2) | Calculated using adjusted net investment income. |
Investments | Page 20 |
Chubb Limited
Investment Portfolio - 2
(in millions of U.S. dollars)
(Unaudited)
Mortgage-backed Fixed Income Portfolio
Mortgage-backed securities
S&P Credit Rating | ||||||||||||||||||||||||
AAA | AA | A | BBB | BB and below | Total | |||||||||||||||||||
Market Value at June 30, 2021 |
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Agency residential mortgage-backed securities (RMBS) |
$ | 99 | $ | 17,605 | $ | | $ | | $ | | $ | 17,704 | ||||||||||||
Non-agency RMBS |
236 | 38 | 72 | 26 | 8 | 380 | ||||||||||||||||||
Commercial mortgage-backed securities |
2,915 | 269 | 155 | 16 | 6 | 3,361 | ||||||||||||||||||
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Total mortgage-backed securities at market value |
$ | 3,250 | $ | 17,912 | $ | 227 | $ | 42 | $ | 14 | $ | 21,445 | ||||||||||||
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U.S. Corporate and Asset-backed Fixed Income Portfolios
Market Value at June 30, 2021
|
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S&P Credit Rating | ||||||||||||||||||||||||
Investment Grade | ||||||||||||||||||||||||
AAA | AA | A | BBB | Total | ||||||||||||||||||||
Asset-backed |
$ | 4,082 | $ | 700 | $ | 28 | $ | 35 | $ | 4,845 | ||||||||||||||
Banks |
| 9 | 1,834 | 2,097 | 3,940 | |||||||||||||||||||
Basic Materials |
| | 101 | 232 | 333 | |||||||||||||||||||
Communications |
| 218 | 438 | 1,549 | 2,205 | |||||||||||||||||||
Consumer, Cyclical |
| 222 | 567 | 836 | 1,625 | |||||||||||||||||||
Consumer, Non-Cyclical |
60 | 581 | 1,905 | 1,872 | 4,418 | |||||||||||||||||||
Diversified Financial Services |
8 | 203 | 380 | 345 | 936 | |||||||||||||||||||
Energy |
| 106 | 192 | 754 | 1,052 | |||||||||||||||||||
Industrial |
| 13 | 991 | 906 | 1,910 | |||||||||||||||||||
Utilities |
| 3 | 1,100 | 582 | 1,685 | |||||||||||||||||||
All Others |
241 | 604 | 1,522 | 1,229 | 3,596 | |||||||||||||||||||
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Total |
$ | 4,391 | $ | 2,659 | $ | 9,058 | $ | 10,437 | $ | 26,545 | ||||||||||||||
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Market Value at June 30, 2021
|
| |||||||||||||||||||||||
S&P Credit Rating | ||||||||||||||||||||||||
Below Investment Grade | ||||||||||||||||||||||||
BB | B | CCC | Total | |||||||||||||||||||||
Asset-backed |
$ | 16 | $ | 4 | $ | 2 | $ | 22 | ||||||||||||||||
Banks |
| | | | ||||||||||||||||||||
Basic Materials |
342 | 185 | 10 | 537 | ||||||||||||||||||||
Communications |
829 | 961 | 78 | 1,868 | ||||||||||||||||||||
Consumer, Cyclical |
1,100 | 1,189 | 129 | 2,418 | ||||||||||||||||||||
Consumer, Non-Cyclical |
1,145 | 1,568 | 79 | 2,792 | ||||||||||||||||||||
Diversified Financial Services |
208 | 192 | 5 | 405 | ||||||||||||||||||||
Energy |
826 | 420 | 9 | 1,255 | ||||||||||||||||||||
Industrial |
595 | 916 | 21 | 1,532 | ||||||||||||||||||||
Utilities |
395 | 44 | 1 | 440 | ||||||||||||||||||||
All Others |
860 | 1,176 | 39 | 2,075 | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||
Total |
$ | 6,316 | $ | 6,655 | $ | 373 | $ | 13,344 | ||||||||||||||||
|
|
|
|
|
|
|
|
Investments 2 | Page 21 |
Chubb Limited
Investment Portfolio - 3
(in millions of U.S. dollars)
(Unaudited)
Non-U.S. Fixed Income Portfolio
June 30, 2021
Non-U.S. Government Securities
Market Value by S&P Credit Rating | ||||||||||||||||||||||||
AAA | AA | A | BBB | BB and below | Total | |||||||||||||||||||
Republic of Korea |
$ | | $ | 1,050 | $ | | $ | | $ | | $ | 1,050 | ||||||||||||
Canada |
1,035 | | | | | 1,035 | ||||||||||||||||||
United Kingdom |
| 824 | | | | 824 | ||||||||||||||||||
Province of Ontario |
| | 714 | | | 714 | ||||||||||||||||||
Kingdom of Thailand |
| | 632 | | | 632 | ||||||||||||||||||
United Mexican States |
| | | 571 | | 571 | ||||||||||||||||||
Federative Republic of Brazil |
| | | | 555 | 555 | ||||||||||||||||||
Province of Quebec |
| 470 | | | | 470 | ||||||||||||||||||
Commonwealth of Australia |
436 | | 1 | | | 437 | ||||||||||||||||||
Socialist Republic of Vietnam |
| | | | 426 | 426 | ||||||||||||||||||
Other Non-U.S. Government Securities |
581 | 1,978 | 1,299 | 785 | 1,091 | 5,734 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total |
$ | 2,052 | $ | 4,322 | $ | 2,646 | $ | 1,356 | $ | 2,072 | $ | 12,448 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Non-U.S. Corporate Securities | ||||||||||||||||||||||||
Market Value by S&P Credit Rating | ||||||||||||||||||||||||
AAA | AA | A | BBB | BB and below | Total | |||||||||||||||||||
United Kingdom |
$ | 64 | $ | 41 | $ | 863 | $ | 1,070 | $ | 520 | $ | 2,558 | ||||||||||||
Canada |
79 | 157 | 542 | 612 | 450 | 1,840 | ||||||||||||||||||
France |
8 | 47 | 634 | 479 | 74 | 1,242 | ||||||||||||||||||
United States (1) |
| | 208 | 278 | 675 | 1,161 | ||||||||||||||||||
Australia |
72 | 178 | 329 | 303 | 25 | 907 | ||||||||||||||||||
Japan |
| 2 | 622 | 67 | | 691 | ||||||||||||||||||
Germany |
83 | 37 | 118 | 301 | 69 | 608 | ||||||||||||||||||
Switzerland |
54 | 7 | 307 | 184 | 40 | 592 | ||||||||||||||||||
Netherlands |
43 | 7 | 227 | 132 | 130 | 539 | ||||||||||||||||||
China |
| 7 | 294 | 111 | 69 | 481 | ||||||||||||||||||
Other Non-U.S. Corporate Securities |
384 | 319 | 1,021 | 1,703 | 1,284 | 4,711 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total |
$ | 787 | $ | 802 | $ | 5,165 | $ | 5,240 | $ | 3,336 | $ | 15,330 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
(1) | Countries represent the ultimate parent companys country of risk. Non-U.S. corporate securities could be issued by foreign subsidiaries of U.S. corporations. |
Investments 3 | Page 22 |
Chubb Limited
Investment Portfolio - 4
(in millions of U.S. dollars)
(Unaudited)
Fixed Maturity Investment Portfolio
Top 10 Global Corporate Exposures
June 30, 2021 |
Market Value | Rating | ||||||
1 | Wells Fargo & Co | $ | 726 | BBB+ | ||||
2 | Bank of America Corp | 657 | A- | |||||
3 | JP Morgan Chase & Co | 615 | A- | |||||
4 | Comcast Corp | 507 | A- | |||||
5 | Verizon Communications Inc | 489 | BBB+ | |||||
6 | Morgan Stanley | 474 | BBB+ | |||||
7 | AT&T Inc | 430 | BBB | |||||
8 | Citigroup Inc | 419 | BBB+ | |||||
9 | HSBC Holdings Plc | 393 | A- | |||||
10 | Goldman Sachs Group Inc | 379 | BBB+ |
Investments 4 | Page 23 |
Chubb Limited
Net Realized and Unrealized Gains (Losses)
(in millions of U.S. dollars)
(Unaudited)
Three months ended June 30, 2021 | ||||||||||||||||||||||||||||||||||||
Realized Gains (Losses) | Unrealized Gains (Losses) | Realized and Unrealized Gains (Losses) | ||||||||||||||||||||||||||||||||||
Gains | Tax | Gains | Gains | Tax | Gains | Gains | Tax | Gains | ||||||||||||||||||||||||||||
(Losses) | (Expense) | (Losses) | (Losses) | (Expense) | (Losses) | (Losses) | (Expense) | (Losses) | ||||||||||||||||||||||||||||
Pre-Tax | Benefit | After-Tax | Pre-Tax | Benefit | After-Tax | Pre-Tax | Benefit | After-Tax | ||||||||||||||||||||||||||||
Fixed income investments (1) |
$ | (79 | ) | $ | 19 | $ | (60 | ) | $ | 694 | $ | (113 | ) | $ | 581 | $ | 615 | $ | (94 | ) | $ | 521 | ||||||||||||||
Public equity: |
||||||||||||||||||||||||||||||||||||
Realized gains (losses) on sales |
45 | (9 | ) | 36 | | | | 45 | (9 | ) | 36 | |||||||||||||||||||||||||
Mark-to-market |
105 | (23 | ) | 82 | | | | 105 | (23 | ) | 82 | |||||||||||||||||||||||||
Private equity: |
||||||||||||||||||||||||||||||||||||
Realized gains (losses) on sales |
| | | | | | | | | |||||||||||||||||||||||||||
Mark-to-market |
736 | (24 | ) | 712 | | | | 736 | (24 | ) | 712 | |||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Total investment portfolio |
807 | (37 | ) | 770 | 694 | (113 | ) | 581 | 1,501 | (150 | ) | 1,351 | ||||||||||||||||||||||||
Mark-to-market from variable annuity reinsurance derivative transactions, net of applicable hedges (2) |
(72 | ) | | (72 | ) | | | | (72 | ) | | (72 | ) | |||||||||||||||||||||||
Foreign exchange |
(97 | ) | 22 | (75 | ) | 308 | (18 | ) | 290 | 211 | 4 | 215 | ||||||||||||||||||||||||
Partially-owned entities (3) |
36 | (1 | ) | 35 | | | | 36 | (1 | ) | 35 | |||||||||||||||||||||||||
Other |
| | | (9 | ) | 2 | (7 | ) | (9 | ) | 2 | (7 | ) | |||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Net gains (losses) |
$ | 674 | $ | (16 | ) | $ | 658 | $ | 993 | $ | (129 | ) | $ | 864 | $ | 1,667 | $ | (145 | ) | $ | 1,522 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) | The quarter includes pre-tax realized losses on fixed income derivatives of $91 million, a net reduction of the valuation allowance of expected credit losses of $10 million, and impairments of $1 million for fixed maturities. |
(2) | The quarter includes $64 million of losses on applicable hedges. These losses are both pre-tax and after-tax. |
(3) | Partially-owned entities are investments where we hold more than an insignificant percentage of the investees shares. Refer to the Non-GAAP financial measures section for additional details. |
Three months ended June 30, 2020 | ||||||||||||||||||||||||||||||||||||
Realized Gains (Losses) | Unrealized Gains (Losses) | Realized and Unrealized Gains (Losses) | ||||||||||||||||||||||||||||||||||
Gains | Tax | Gains | Gains | Tax | Gains | Gains | Tax | Gains | ||||||||||||||||||||||||||||
(Losses) | (Expense) | (Losses) | (Losses) | (Expense) | (Losses) | (Losses) | (Expense) | (Losses) | ||||||||||||||||||||||||||||
Pre-Tax | Benefit | After-Tax | Pre-Tax | Benefit | After-Tax | Pre-Tax | Benefit | After-Tax | ||||||||||||||||||||||||||||
Fixed income investments (4) |
$ | (19 | ) | $ | | $ | (19 | ) | $ | 3,281 | $ | (524 | ) | $ | 2,757 | $ | 3,262 | $ | (524 | ) | $ | 2,738 | ||||||||||||||
Public equity (4): |
||||||||||||||||||||||||||||||||||||
Realized gains (losses) on sales |
187 | (39 | ) | 148 | | | | 187 | (39 | ) | 148 | |||||||||||||||||||||||||
Mark-to-market |
(39 | ) | 11 | (28 | ) | | | | (39 | ) | 11 | (28 | ) | |||||||||||||||||||||||
Private equity: |
||||||||||||||||||||||||||||||||||||
Realized gains (losses) on sales |
| | | | | | | | | |||||||||||||||||||||||||||
Mark-to-market |
(200 | ) | 11 | (189 | ) | | | | (200 | ) | 11 | (189 | ) | |||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Total investment portfolio |
(71 | ) | (17 | ) | (88 | ) | 3,281 | (524 | ) | 2,757 | 3,210 | (541 | ) | 2,669 | ||||||||||||||||||||||
Mark-to-market from variable annuity reinsurance derivative transactions, net of applicable hedges (5) |
110 | | 110 | | | | 110 | | 110 | |||||||||||||||||||||||||||
Foreign exchange |
(61 | ) | 20 | (41 | ) | 445 | 6 | 451 | 384 | 26 | 410 | |||||||||||||||||||||||||
Partially-owned entities (6) |
(7 | ) | | (7 | ) | | | | (7 | ) | | (7 | ) | |||||||||||||||||||||||
Other |
(40 | ) | 8 | (32 | ) | (22 | ) | 5 | (17 | ) | (62 | ) | 13 | (49 | ) | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Net gains (losses) |
$ | (69 | ) | $ | 11 | $ | (58 | ) | $ | 3,704 | $ | (513 | ) | $ | 3,191 | $ | 3,635 | $ | (502 | ) | $ | 3,133 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(4) | The quarter includes pre-tax realized gains on fixed income derivatives of $14 million, realized gains related to the adoption of new accounting guidance that required the acceleration of certain mark-to-market losses on fixed maturities, previously classified as unrealized gains, as realized gains of $104 million, and impairment of $31 million for fixed maturities written to market entering default and our intent to sell certain securities during the quarter. |
(5) | The quarter includes $103 million of losses on applicable hedges. These losses are both pre-tax and after-tax. |
(6) | Partially-owned entities are investments where we hold more than an insignificant percentage of the investees shares. Refer to the Non-GAAP financial measures section for additional details. |
Net Gains (Losses) | Page 24 |
Chubb Limited
Net Realized and Unrealized Gains (Losses)
(in millions of U.S. dollars)
(Unaudited)
Six months ended June 30, 2021 | ||||||||||||||||||||||||||||||||||||
Realized Gains (Losses) | Unrealized Gains (Losses) | Realized and Unrealized Gains (Losses) | ||||||||||||||||||||||||||||||||||
Gains | Tax | Gains | Gains | Tax | Gains | Gains | Tax | Gains | ||||||||||||||||||||||||||||
(Losses) | (Expense) | (Losses) | (Losses) | (Expense) | (Losses) | (Losses) | (Expense) | (Losses) | ||||||||||||||||||||||||||||
Pre-Tax | Benefit | After-Tax | Pre-Tax | Benefit | After-Tax | Pre-Tax | Benefit | After-Tax | ||||||||||||||||||||||||||||
Fixed income investments (1) |
$ | 54 | $ | (5 | ) | $ | 49 | $ | (1,623 | ) | $ | 292 | $ | (1,331 | ) | $ | (1,569 | ) | $ | 287 | $ | (1,282 | ) | |||||||||||||
Public equity: |
||||||||||||||||||||||||||||||||||||
Realized gains (losses) on sales |
90 | (16 | ) | 74 | | | | 90 | (16 | ) | 74 | |||||||||||||||||||||||||
Mark-to-market |
427 | (91 | ) | 336 | | | | 427 | (91 | ) | 336 | |||||||||||||||||||||||||
Private equity: |
||||||||||||||||||||||||||||||||||||
Realized gains (losses) on sales |
| | | | | | | | | |||||||||||||||||||||||||||
Mark-to-market |
1,174 | (38 | ) | 1,136 | | | | 1,174 | (38 | ) | 1,136 | |||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Total investment portfolio |
1,745 | (150 | ) | 1,595 | (1,623 | ) | 292 | (1,331 | ) | 122 | 142 | 264 | ||||||||||||||||||||||||
Mark-to-market from variable annuity reinsurance derivative transactions, net of applicable hedges (2) |
203 | | 203 | | | | 203 | | 203 | |||||||||||||||||||||||||||
Foreign exchange |
(21 | ) | 4 | (17 | ) | 330 | (16 | ) | 314 | 309 | (12 | ) | 297 | |||||||||||||||||||||||
Partially-owned entities (3) |
55 | (3 | ) | 52 | | | | 55 | (3 | ) | 52 | |||||||||||||||||||||||||
Other |
(1 | ) | | (1 | ) | (37 | ) | 7 | (30 | ) | (38 | ) | 7 | (31 | ) | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Net gains (losses) |
$ | 1,981 | $ | (149 | ) | $ | 1,832 | $ | (1,330 | ) | $ | 283 | $ | (1,047 | ) | $ | 651 | $ | 134 | $ | 785 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) | Year to date includes pre-tax realized gains on fixed income derivatives of $18 million, a net reduction of the valuation allowance of expected credit losses of $16 million, and impairments of $1 million for fixed maturities. |
(2) | Year to date includes $108 million of losses on applicable hedges. These losses are both pre-tax and after-tax. |
(3) | Partially-owned entities are investments where we hold more than an insignificant percentage of the investees shares. Refer to the Non-GAAP financial measures section for additional details. |
Six months ended June 30, 2020 | ||||||||||||||||||||||||||||||||||||
Realized Gains (Losses) | Unrealized Gains (Losses) | Realized and Unrealized Gains (Losses) | ||||||||||||||||||||||||||||||||||
Gains | Tax | Gains | Gains | Tax | Gains | Gains | Tax | Gains | ||||||||||||||||||||||||||||
(Losses) | (Expense) | (Losses) | (Losses) | (Expense) | (Losses) | (Losses) | (Expense) | (Losses) | ||||||||||||||||||||||||||||
Pre-Tax | Benefit | After-Tax | Pre-Tax | Benefit | After-Tax | Pre-Tax | Benefit | After-Tax | ||||||||||||||||||||||||||||
Fixed income investments (4) |
$ | (365 | ) | $ | 40 | $ | (325 | ) | $ | 1,121 | $ | (240 | ) | $ | 881 | $ | 756 | $ | (200 | ) | $ | 556 | ||||||||||||||
Public equity (4): |
||||||||||||||||||||||||||||||||||||
Realized gains (losses) on sales |
205 | (42 | ) | 163 | | | | 205 | (42 | ) | 163 | |||||||||||||||||||||||||
Mark-to-market |
(44 | ) | 3 | (41 | ) | | | | (44 | ) | 3 | (41 | ) | |||||||||||||||||||||||
Private equity: |
||||||||||||||||||||||||||||||||||||
Realized gains (losses) on sales |
| | | | | | | | | |||||||||||||||||||||||||||
Mark-to-market |
(207 | ) | 2 | (205 | ) | | | | (207 | ) | 2 | (205 | ) | |||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Total investment portfolio |
(411 | ) | 3 | (408 | ) | 1,121 | (240 | ) | 881 | 710 | (237 | ) | 473 | |||||||||||||||||||||||
Mark-to-market from variable annuity reinsurance derivative transactions, net of applicable hedges (5) |
(450 | ) | | (450 | ) | | | | (450 | ) | | (450 | ) | |||||||||||||||||||||||
Foreign exchange |
(129 | ) | 17 | (112 | ) | (414 | ) | 40 | (374 | ) | (543 | ) | 57 | (486 | ) | |||||||||||||||||||||
Partially-owned entities (6) |
(2 | ) | | (2 | ) | | | | (2 | ) | | (2 | ) | |||||||||||||||||||||||
Other |
(40 | ) | 8 | (32 | ) | (36 | ) | 8 | (28 | ) | (76 | ) | 16 | (60 | ) | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Net gains (losses) |
$ | (1,032 | ) | $ | 28 | $ | (1,004 | ) | $ | 671 | $ | (192 | ) | $ | 479 | $ | (361 | ) | $ | (164 | ) | $ | (525 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(4) | Year to date includes pre-tax realized gains on equity derivatives of $42 million, realized losses on fixed income derivatives of $13 million, realized losses related to the adoption of new accounting guidance that required the acceleration of certain mark-to-market losses on fixed maturities, previously classified as unrealized losses, as realized losses of $46 million, and impairments of $152 million related to certain securities the company intended to sell and securities written to market entering default. |
(5) | Year to date includes $22 million of gains on applicable hedges. These gains are both pre-tax and after-tax. |
(6) | Partially-owned entities are investments where we hold more than an insignificant percentage of the investees shares. Refer to the Non-GAAP financial measures section for additional details. |
Net Gains (Losses) 2 | Page 25 |
Chubb Limited
Debt and Capital
(in millions of U.S. dollars, except ratios)
(Unaudited)
June 30 | March 31 | December 31 | December 31 | |||||||||||||
2021 | 2021 | 2020 | 2019 | |||||||||||||
Financial Debt: |
||||||||||||||||
Total short-term debt |
$ | | $ | | $ | | $ | 1,299 | ||||||||
Total long-term debt |
14,954 | 14,879 | 14,948 | 13,559 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total financial debt |
$ | 14,954 | $ | 14,879 | $ | 14,948 | $ | 14,858 | ||||||||
Hybrid debt: |
||||||||||||||||
Total trust preferred securities |
308 | 308 | 308 | 308 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total |
$ | 15,262 | $ | 15,187 | $ | 15,256 | $ | 15,166 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Capitalization: |
||||||||||||||||
Shareholders equity |
$ | 60,062 | $ | 59,076 | $ | 59,441 | $ | 55,331 | ||||||||
Hybrid debt |
308 | 308 | 308 | 308 | ||||||||||||
Financial debt |
14,954 | 14,879 | 14,948 | 14,858 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total capitalization |
$ | 75,324 | $ | 74,263 | $ | 74,697 | $ | 70,497 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Leverage ratios (based on total capital): |
||||||||||||||||
Hybrid debt |
0.4 | % | 0.4 | % | 0.4 | % | 0.4 | % | ||||||||
Financial debt |
19.9 | % | 20.0 | % | 20.0 | % | 21.1 | % | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Total hybrid & financial debt |
20.3 | % | 20.4 | % | 20.4 | % | 21.5 | % |
Note: As of June 30, 2021, there was $1.4 billion usage of credit facilities on total capacity of $3.7 billion.
Debt and Capital | Page 26 |
Chubb Limited
Computation of Basic and Diluted Earnings Per Share
(in millions of U.S. dollars, except share and per share data)
(Unaudited)
Three months ended June 30 | Six months ended June 30 | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
Numerator |
||||||||||||||||
Core operating income (loss) to common shares |
$ | 1,621 | $ | (254 | ) | $ | 2,763 | $ | 966 | |||||||
Amortization of fair value adjustment of acquired invested assets and long-term debt, pre-tax |
(17 | ) | (24 | ) | (38 | ) | (51 | ) | ||||||||
Tax benefit on amortization adjustment |
3 | 5 | 8 | 10 | ||||||||||||
Adjusted net realized gains (losses), pre-tax |
674 | (69 | ) | 1,981 | (1,032 | ) | ||||||||||
Tax (expense) benefit on adjusted net realized gains (losses) |
(16 | ) | 11 | (149 | ) | 28 | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net income (loss) |
$ | 2,265 | $ | (331 | ) | $ | 4,565 | $ | (79 | ) | ||||||
|
|
|
|
|
|
|
|
|||||||||
Rollforward of Common Shares Outstanding |
||||||||||||||||
Shares - beginning of period |
449,676,959 | 451,367,782 | 450,732,625 | 451,971,567 | ||||||||||||
Repurchase of shares |
(11,355,400 | ) | | (14,465,400 | ) | (2,266,150 | ) | |||||||||
Shares issued (cancelled), excluding option exercises |
63,905 | (64,658 | ) | 1,071,010 | 1,027,562 | |||||||||||
Issued for option exercises |
331,749 | 56,899 | 1,378,978 | 627,044 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Shares - end of period |
438,717,213 | 451,360,023 | 438,717,213 | 451,360,023 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Denominator |
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Weighted average shares outstanding (1) |
445,094,678 | 451,402,807 | 447,802,079 | 451,635,733 | ||||||||||||
Effect of other dilutive securities (2) |
2,857,242 | | 2,900,440 | | ||||||||||||
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Adj. wtd. avg. shares outstanding and assumed conversions |
447,951,920 | 451,402,807 | 450,702,519 | 451,635,733 | ||||||||||||
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Basic earnings per share |
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Core operating income (loss) |
$ | 3.64 | $ | (0.56 | ) | $ | 6.17 | $ | 2.14 | |||||||
Amortization of fair value adjustment of acquired invested assets and long-term debt, net of tax |
(0.03 | ) | (0.04 | ) | (0.07 | ) | (0.09 | ) | ||||||||
Adjusted net realized gains (losses), net of tax |
1.48 | (0.13 | ) | 4.10 | (2.22 | ) | ||||||||||
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Net income (loss) |
$ | 5.09 | $ | (0.73 | ) | $ | 10.20 | $ | (0.17 | ) | ||||||
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Diluted earnings per share |
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Core operating income (loss) (2) |
$ | 3.62 | $ | (0.56 | ) | $ | 6.13 | $ | 2.13 | |||||||
Amortization of fair value adjustment of acquired invested assets and long-term debt, net of tax |
(0.03 | ) | (0.04 | ) | (0.07 | ) | (0.09 | ) | ||||||||
Adjusted net realized gains (losses), net of tax |
1.47 | (0.13 | ) | 4.07 | (2.22 | ) | ||||||||||
Use of weighted-average dilutive shares |
| | | 0.01 | ||||||||||||
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Net income (loss) (2) |
$ | 5.06 | $ | (0.73 | ) | $ | 10.13 | $ | (0.17 | ) | ||||||
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(1) | Includes unvested restricted stock units that are not included in common shares outstanding as the shares are not issued until time of vesting, but are eligible to receive dividends (participating securities). |
(2) | In periods where core operating loss and net loss are recognized, inclusion of incremental dilution is anti-dilutive and therefore basic shares are used in the calculation of per share earnings. For the three and six months ended June 30, 2020, the effect of dilutive securities was 1,395,951 shares and 2,044,144 shares, respectively. Weighted-average shares outstanding used to calculate earnings per share for the 2021 periods and core operating income per share for the six months ended June 30, 2020 include the effect of dilutive securities. |
Earnings per share | Page 27 |
Chubb Limited
Book Value and Book Value per Common Share
(in millions of U.S. dollars, except share and per share data)
(Unaudited)
Reconciliation of Book Value per Common Share
June 30 | March 31 | December 31 | June 30 | |||||||||||||
2021 | 2021 | 2020 | 2020 | |||||||||||||
Shareholders equity |
$ | 60,062 | $ | 59,076 | $ | 59,441 | $ | 54,760 | ||||||||
Less: goodwill and other intangible assets, net of tax |
19,930 | 19,881 | 19,916 | 19,783 | ||||||||||||
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Numerator for tangible book value per share |
$ | 40,132 | $ | 39,195 | $ | 39,525 | $ | 34,977 | ||||||||
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Book value - % change over prior quarter |
1.7 | % | -0.6 | % | 5.4 | % | 4.9 | % | ||||||||
Tangible book value - % change over prior quarter |
2.4 | % | -0.8 | % | 8.0 | % | 7.2 | % | ||||||||
Denominator |
438,717,213 | 449,676,959 | 450,732,625 | 451,360,023 | ||||||||||||
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Book value per common share |
$ | 136.90 | $ | 131.37 | $ | 131.88 | $ | 121.32 | ||||||||
Tangible book value per common share |
$ | 91.48 | $ | 87.16 | $ | 87.69 | $ | 77.49 | ||||||||
Reconciliation of Book Value | ||||||||||||||||
Shareholders equity, beginning of quarter |
$ | 59,076 | $ | 59,441 | $ | 56,413 | $ | 52,188 | ||||||||
Core operating income (loss) |
1,621 | 1,142 | 1,440 | (254 | ) | |||||||||||
Amortization of fair value adjustment of acquired invested assets and long-term debt |
(14 | ) | (16 | ) | (18 | ) | (19 | ) | ||||||||
Adjusted net realized gains (losses) (1) |
658 | 1,174 | 996 | (58 | ) | |||||||||||
Net unrealized gains (losses) on investments |
581 | (1,912 | ) | 706 | 2,757 | |||||||||||
Repurchase of shares |
(1,921 | ) | (519 | ) | (190 | ) | | |||||||||
Dividend declared on common shares |
(352 | ) | (352 | ) | (352 | ) | (353 | ) | ||||||||
Cumulative translation gains (losses) |
290 | 24 | 443 | 451 | ||||||||||||
Postretirement benefit liability |
(7 | ) | (23 | ) | (136 | ) | (17 | ) | ||||||||
Other (2) |
130 | 117 | 139 | 65 | ||||||||||||
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$ | 60,062 | $ | 59,076 | $ | 59,441 | $ | 54,760 | |||||||||
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(1) | Includes net realized gains (losses) related to unconsolidated entities. |
(2) | Other primarily includes proceeds from exercise of stock options and stock compensation, offset by the value of any share cancellations for restricted stock vesting taxes. |
Reconciliation Book Value | Page 28 |
Chubb Limited
Non-GAAP Financial Measures
(Unaudited)
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.
P&C underwriting income (loss) excludes the Life Insurance segment and is calculated by subtracting adjusted losses and loss expenses, adjusted policy benefits, policy acquisition costs and administrative expenses from net premiums earned. 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 CAY underwriting income excluding catastrophe losses (Cats) is P&C underwriting income (loss) adjusted to exclude P&C Cats and prior period development (PPD). We believe it is useful to exclude Cats, 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.
Adjusted losses and loss expenses include 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.
Adjusted policy benefits includes gains and losses from fair value changes in separate account assets, as well as the offsetting movement in separate account liabilities, for purposes of reporting Life Insurance underwriting income. The gains and losses from fair value changes in separate account assets that do not qualify for separate account reporting under GAAP have been reclassified from Other (income) expense. We view gains and losses from fair value changes in both separate account assets and liabilities as part of the results of our underwriting operations, and therefore these gains and losses are reclassified to adjusted policy benefits.
Adjusted net investment income is net investment income excluding the amortization of the fair value adjustment on acquired invested assets from the acquisition of The Chubb Corporation (Chubb Corp) and including investment income from partially-owned investment companies (private equity partnerships) where our ownership interest is in excess of three percent that are accounted for under the equity method. 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.
Adjusted interest expense is interest expense excluding the amortization of the fair value adjustment on acquired long-term debt, related to the Chubb Corp acquisition due to the size and complexity of this acquisition.
Other income (expense) - operating excludes from consolidated Other income (expense) the portion of net realized gains and losses related to unconsolidated entities, other income (expense) from private equity partnerships, and gains and losses from fair value changes in separate account assets that do not qualify for separate account reporting under GAAP. Net realized gains (losses) related to unconsolidated entities is excluded from core operating income (loss) in order to enhance the understanding of our results of underwriting operations as they are heavily influenced by, and fluctuate in part according to, market conditions. Other income (expense) from private equity partnerships and net realized gains and losses related to unconsolidated entities are recorded to Other income (expense) in our income statement on a GAAP basis.
P&C combined ratio excludes the Life Insurance segment. P&C loss and loss expense ratio and P&C combined ratio include adjusted losses and loss expenses in the ratio numerator. P&C expense ratio and P&C combined ratio include policy acquisition costs and administrative expenses in the ratio numerator. A reconciliation of combined ratio to P&C combined ratio is provided on pages 32-35.
CAY P&C combined ratio excluding catastrophe losses excludes Cats and PPD from the P&C combined ratio. We exclude Cats 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. The combined ratio numerator is adjusted to exclude Cats, net premiums earned adjustments on PPD, prior period expense adjustments and reinstatement premiums on PPD, and the denominator is adjusted to exclude net premiums earned adjustments on PPD and reinstatement premiums on Cats and PPD. In periods where there are adjustments on loss sensitive policies, these adjustments are excluded from PPD and net premiums earned when calculating the ratios. We believe this measure provides a better evaluation of our underwriting performance and enhances the understanding of the trends in our P&C business that may be obscured by these items. This measure is commonly reported among our peer companies and allows for a better comparison.
Expense ratio excluding accident and health (A&H) excludes the impact of our A&H business from our expense ratio. The expense ratio for the A&H business is typically higher than our traditional P&C business, and we believe that this measure provides better comparison to our peer companies that may not have a significant A&H block of business.
Global P&C performance metrics comprise consolidated operating results (including corporate) and exclude the operating results of the companys 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 companys P&C insurance business. We believe that these measures are useful and meaningful to investors as they are used by management to assess the companys 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.
Core operating income (loss), net of tax, excludes from net income, the after-tax impact of adjusted net realized gains (losses) and the amortization of fair value adjustment of acquired invested assets and long-term debt related to the Chubb Corp acquisition. 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 the fair value adjustments related to purchased invested assets and long-term debt due to the size and complexity of this acquisition. References to core operating income measures mean net of tax, whether or not noted.
Core operating effective tax rate is income tax expense (benefit) excluding tax expense (benefit) on adjusted net realized gains (losses) and tax benefit on amortization of fair value of acquired invested assets and debt, divided by income excluding adjusted net realized gains (losses) before tax and amortization of fair value of acquired invested assets and debt before tax. We believe the use of this measure is meaningful to show the tax on the underlying performance of our insurance business, by excluding the tax on adjusted net realized gains (losses), the tax on amortization of the fair value adjustments related to purchased invested assets and long-term debt. Refer to the definition of core operating income (loss), net of tax above for more information on these adjustments.
Book value per common share, is shareholders equity divided by the shares outstanding. Tangible book value per common share, is 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 common share excluding mark-to-market, excludes unrealized investment gains (losses). Tangible book value per common share excluding mark-to-market, excludes goodwill and other intangible assets, net of tax, as well as unrealized investment gains (losses), net of tax. We exclude unrealized investment gains (losses) because the amount of these gains (losses) is heavily influenced by changes in market conditions, including interest rate changes, and we believe that excluding these gains and losses would highlight the underlying growth in book value and tangible book value.
International life insurance net premiums written and deposits collected includes deposits collected on universal life and investment contracts (life deposits). Life deposits are not reflected as revenues in our consolidated statements of operations in accordance with GAAP. However, we include life deposits in presenting growth in our life insurance business because new life deposits are an important component of production and key to our efforts to grow our business.
Reconciliation Non-GAAP | Page 29 |
Chubb Limited
Non-GAAP Financial Measures - 2
(in millions of U.S. dollars, except per share data and ratios)
(Unaudited)
Regulation G - Non-GAAP Financial Measures (continued)
Core operating effective tax rate |
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The following table presents the reconciliation of effective tax rate to the Core operating effective tax rate:
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2Q-21 | 1Q-21 | 4Q-20 | 3Q-20 | 2Q-20 | YTD 2021 |
YTD 2020 |
Full Year 2020 |
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Tax expense (benefit), as reported |
$ | 317 | $ | 338 | $ | 334 | $ | 142 | $ | (62 | ) | $ | 655 | $ | 153 | $ | 629 | |||||||||||||||
Less: tax benefit on amortization of fair value of acquired invested assets and debt |
(3 | ) | (5 | ) | (3 | ) | (4 | ) | (5 | ) | (8 | ) | (10 | ) | (17 | ) | ||||||||||||||||
Less: tax expense (benefit) on adjusted net realized gains (losses) |
16 | 133 | 78 | (26 | ) | (11 | ) | 149 | (28 | ) | 24 | |||||||||||||||||||||
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Tax expense (benefit), adjusted |
$ | 304 | $ | 210 | $ | 259 | $ | 172 | $ | (46 | ) | $ | 514 | $ | 191 | $ | 622 | |||||||||||||||
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Income (loss) before tax, as reported |
$ | 2,582 | $ | 2,638 | $ | 2,752 | $ | 1,336 | $ | (393 | ) | $ | 5,220 | $ | 74 | $ | 4,162 | |||||||||||||||
Less: amortization of fair value of acquired invested assets and debt |
(17 | ) | (21 | ) | (21 | ) | (23 | ) | (24 | ) | (38 | ) | (51 | ) | (95 | ) | ||||||||||||||||
Less: adjusted realized gains (losses) |
(36 | ) | 888 | 568 | (142 | ) | 31 | 852 | (925 | ) | (499 | ) | ||||||||||||||||||||
Less: realized gains (losses) related to unconsolidated entities |
710 | 419 | 506 | 422 | (100 | ) | 1,129 | (107 | ) | 821 | ||||||||||||||||||||||
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Core operating income (loss) before tax |
$ | 1,925 | $ | 1,352 | $ | 1,699 | $ | 1,079 | $ | (300 | ) | $ | 3,277 | $ | 1,157 | $ | 3,935 | |||||||||||||||
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Effective tax rate |
12.3 | % | 12.8 | % | 12.1 | % | 10.7 | % | 15.8 | % | 12.5 | % | 206.8 | % | 15.1 | % | ||||||||||||||||
Adjustment for tax impact of amortization of fair value of acquired invested assets and debt |
0.0 | % | 0.1 | % | 0.0 | % | 0.0 | % | -0.4 | % | 0.1 | % | 0.1 | % | 0.1 | % | ||||||||||||||||
Adjustment for tax impact of adjusted net realized gains (losses) |
3.5 | % | 2.6 | % | 3.1 | % | 5.3 | % | -0.1 | % | 3.1 | % | -190.4 | % | 0.6 | % | ||||||||||||||||
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Core operating effective tax rate |
15.8 | % | 15.5 | % | 15.2 | % | 16.0 | % | 15.3 | % | 15.7 | % | 16.5 | % | 15.8 | % | ||||||||||||||||
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Core operating income |
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The following table presents the reconciliation of Net income (loss) to Core operating income (loss):
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2Q-21 | 1Q-21 | 4Q-20 | 3Q-20 | 2Q-20 | YTD 2021 |
YTD 2020 |
Full Year 2020 |
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Net income (loss), as reported |
$ | 2,265 | $ | 2,300 | $ | 2,418 | $ | 1,194 | $ | (331 | ) | $ | 4,565 | $ | (79 | ) | $ | 3,533 | ||||||||||||||
Amortization of fair value adjustment of acquired invested assets and long-term debt, pre-tax |
(17 | ) | (21 | ) | (21 | ) | (23 | ) | (24 | ) | (38 | ) | (51 | ) | (95 | ) | ||||||||||||||||
Tax benefit on amortization adjustment |
3 | 5 | 3 | 4 | 5 | 8 | 10 | 17 | ||||||||||||||||||||||||
Adjusted realized gains (losses), pre-tax |
(36 | ) | 888 | 568 | (142 | ) | 31 | 852 | (925 | ) | (499 | ) | ||||||||||||||||||||
Net realized gains (losses) related to unconsolidated entities, pre-tax (1) |
710 | 419 | 506 | 422 | (100 | ) | 1,129 | (107 | ) | 821 | ||||||||||||||||||||||
Tax (expense) benefit on adjusted net realized gains (losses) |
(16 | ) | (133 | ) | (78 | ) | 26 | 11 | (149 | ) | 28 | (24 | ) | |||||||||||||||||||
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Core operating income (loss) |
$ | 1,621 | $ | 1,142 | $ | 1,440 | $ | 907 | $ | (254 | ) | $ | 2,763 | $ | 966 | $ | 3,313 | |||||||||||||||
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Catastrophe losses - after-tax |
$ | 226 | $ | 570 | $ | 271 | $ | 797 | $ | 1,510 | $ | 796 | $ | 1,709 | $ | 2,777 | ||||||||||||||||
Unfavorable (favorable) prior period development (PPD) - after-tax |
$ | (224 | ) | $ | (156 | ) | $ | (189 | ) | $ | (126 | ) | $ | 52 | $ | (380 | ) | $ | (42 | ) | $ | (357 | ) | |||||||||
Core operating income (loss) per share |
$ | 3.62 | $ | 2.52 | $ | 3.18 | $ | 2.00 | $ | (0.56 | ) | $ | 6.13 | $ | 2.13 | $ | 7.31 | |||||||||||||||
Impact of Cats on Core operating income per share - Unfavorable |
$ | (0.50 | ) | $ | (1.26 | ) | $ | (0.60 | ) | $ | (1.76 | ) | $ | (3.35 | ) | $ | (1.77 | ) | $ | (3.77 | ) | $ | (6.12 | ) | ||||||||
Impact of PPD on Core operating income per share - Favorable (unfavorable) |
$ | 0.50 | $ | 0.35 | $ | 0.42 | $ | 0.28 | $ | (0.11 | ) | $ | 0.85 | $ | 0.10 | $ | 0.79 | |||||||||||||||
Impact of Cats and PPD on Core operating income per share - Unfavorable |
$ | | $ | (0.91 | ) | $ | (0.18 | ) | $ | (1.48 | ) | $ | (3.46 | ) | $ | (0.92 | ) | $ | (3.67 | ) | $ | (5.33 | ) | |||||||||
(1) Realized gains (losses) on partially-owned entities, which are investments where we hold more than an insignificant percentage of the investees shares. The net income or loss is included in other income (expense). |
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P&C Underwriting income and P&C CAY underwriting income ex Cats
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The following table presents the reconciliation of Net income (loss) to P&C CAY underwriting income ex Cats:
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2Q-21 | 1Q-21 | 4Q-20 | 3Q-20 | 2Q-20 | YTD 2021 |
YTD 2020 |
Full Year 2020 |
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Net income (loss), as reported |
$ | 2,265 | $ | 2,300 | $ | 2,418 | $ | 1,194 | $ | (331 | ) | $ | 4,565 | $ | (79 | ) | $ | 3,533 | ||||||||||||||
Less: Income tax (expense) benefit |
(317 | ) | (338 | ) | (334 | ) | (142 | ) | 62 | (655 | ) | (153 | ) | (629 | ) | |||||||||||||||||
Amortization expense of purchased intangibles |
(73 | ) | (72 | ) | (73 | ) | (72 | ) | (72 | ) | (145 | ) | (145 | ) | (290 | ) | ||||||||||||||||
Other income (expense) |
777 | 490 | 622 | 485 | (58 | ) | 1,267 | (113 | ) | 994 | ||||||||||||||||||||||
Interest expense |
(122 | ) | (122 | ) | (126 | ) | (130 | ) | (128 | ) | (244 | ) | (260 | ) | (516 | ) | ||||||||||||||||
Net investment income |
884 | 863 | 847 | 840 | 827 | 1,747 | 1,688 | 3,375 | ||||||||||||||||||||||||
Net realized gains (losses) |
(33 | ) | 887 | 571 | (141 | ) | 30 | 854 | (928 | ) | (498 | ) | ||||||||||||||||||||
Life Insurance underlying loss (1) |
(39 | ) | (31 | ) | (55 | ) | (37 | ) | (64 | ) | (70 | ) | (20 | ) | (112 | ) | ||||||||||||||||
Add: Realized gains (losses) on crop derivatives |
3 | (1 | ) | 3 | 1 | (1 | ) | 2 | (3 | ) | 1 | |||||||||||||||||||||
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P&C underwriting income (loss) |
$ | 1,191 | $ | 622 | $ | 969 | $ | 392 | $ | (929 | ) | $ | 1,813 | $ | (151 | ) | $ | 1,210 | ||||||||||||||
Add: Catastrophe losses (including reinstatement premiums) - pre-tax |
280 | 700 | 296 | 925 | 1,801 | 980 | 2,038 | 3,259 | ||||||||||||||||||||||||
Unfavorable (favorable) prior period development (PPD) - pre-tax |
(268 | ) | (192 | ) | (206 | ) | (146 | ) | 75 | (460 | ) | (43 | ) | (395 | ) | |||||||||||||||||
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P&C CAY underwriting income ex Cats |
$ | 1,203 | $ | 1,130 | $ | 1,059 | $ | 1,171 | $ | 947 | $ | 2,333 | $ | 1,844 | $ | 4,074 | ||||||||||||||||
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(1) | Life Insurance underlying loss is calculated by subtracting losses and loss expenses, policy benefits, policy acquisition costs and administrative expenses from net premiums earned related to the Life Insurance segment. |
Reconciliation Non-GAAP 2 | Page 30 |
Chubb Limited
Non-GAAP Financial Measures - 3
(in millions of U.S. dollars, except share, per share data, and ratios)
(Unaudited)
Regulation G - Non-GAAP Financial Measures (continued)
Core operating ROE
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 shareholders equity for the period adjusted to exclude unrealized gains (losses) on investments, net of tax. For the ROTE calculation, the denominator is also adjusted to exclude 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.
YTD | YTD | Full Year | ||||||||||||||||||
2Q-21 | 2Q-20 | 2021 | 2020 | 2020 | ||||||||||||||||
Net income (loss) |
$ | 2,265 | $ | (331 | ) | $ | 4,565 | $ | (79 | ) | $ | 3,533 | ||||||||
Core operating income (loss) |
$ | 1,621 | $ | (254 | ) | $ | 2,763 | $ | 966 | $ | 3,313 | |||||||||
Equity - beginning of period, as reported |
$ | 59,076 | $ | 52,188 | $ | 59,441 | $ | 55,259 | $ | 55,259 | ||||||||||
Less: unrealized gains (losses) on investments, net of deferred tax |
2,761 | 667 | 4,673 | 2,543 | 2,543 | |||||||||||||||
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Equity - beginning of period, as adjusted |
$ | 56,315 | $ | 51,521 | $ | 54,768 | $ | 52,716 | $ | 52,716 | ||||||||||
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Less: goodwill and other intangible assets, net of tax |
$ | 19,881 | $ | 19,569 | $ | 19,916 | $ | 20,012 | $ | 20,012 | ||||||||||
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Equity - beginning of period, as adjusted ex goodwill and other intangible assets |
$ | 36,434 | $ | 31,952 | $ | 34,852 | $ | 32,704 | $ | 32,704 | ||||||||||
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Equity - end of period, as reported |
$ | 60,062 | $ | 54,760 | $ | 60,062 | $ | 54,760 | $ | 59,441 | ||||||||||
Less: unrealized gains (losses) on investments, net of deferred tax |
3,342 | 3,424 | 3,342 | 3,424 | 4,673 | |||||||||||||||
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Equity - end of period, as adjusted |
$ | 56,720 | $ | 51,336 | $ | 56,720 | $ | 51,336 | $ | 54,768 | ||||||||||
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Less: goodwill and other intangible assets, net of tax |
19,929 | 19,783 | 19,929 | 19,783 | 19,916 | |||||||||||||||
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Equity - end of period, as adjusted ex goodwill and other intangible assets |
$ | 36,791 | $ | 31,553 | $ | 36,791 | $ | 31,553 | $ | 34,852 | ||||||||||
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Weighted average equity, as reported |
$ | 59,569 | $ | 53,474 | $ | 59,752 | $ | 55,010 | $ | 57,350 | ||||||||||
Weighted average equity, as adjusted |
$ | 56,518 | $ | 51,429 | $ | 55,744 | $ | 52,026 | $ | 53,742 | ||||||||||
Weighted average equity, as adjusted ex goodwill and other intangible assets |
$ | 36,613 | $ | 31,753 | $ | 35,822 | $ | 32,129 | $ | 33,778 | ||||||||||
ROE |
15.2 | % | -2.5 | % | 15.3 | % | -0.3 | % | 6.2 | % | ||||||||||
Core operating ROE |
11.5 | % | -2.0 | % | 9.9 | % | 3.7 | % | 6.2 | % | ||||||||||
Core operating ROTE |
17.7 | % | -3.2 | % | 15.4 | % | 6.0 | % | 9.8 | % | ||||||||||
Private equities realized gains (losses), after-tax (1) |
$ | 712 | $ | (189 | ) | $ | 1,136 | $ | (205 | ) | $ | 690 | ||||||||
Impact of Private equities if included in Core operating ROE - Favorable (unfavorable) (1) |
5.0 pts | -1.5 pts | 4.1 pts | -0.8 pt | 1.3 pts | |||||||||||||||
Reconciliation of Book Value and Tangible Book Value per Share, excluding mark-to-market |
| |||||||||||||||||||
June 30 2021 |
March 31 2021 |
December 31 2020 |
QTD % Change |
YTD % Change |
||||||||||||||||
Book value |
$ | 60,062 | $ | 59,076 | $ | 59,441 | ||||||||||||||
Less: unrealized gains (losses) on investments, net of deferred tax |
3,342 | 2,761 | 4,673 | |||||||||||||||||
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Book value excluding mark-to-market |
56,720 | 56,315 | 54,768 | |||||||||||||||||
Less: goodwill and other intangible assets, net of tax |
19,929 | 19,881 | 19,916 | |||||||||||||||||
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Tangible book value excluding mark-to-market |
$ | 36,791 | $ | 36,434 | $ | 34,852 | ||||||||||||||
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Denominator |
438,717,213 | 449,676,959 | 450,732,625 | |||||||||||||||||
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Book value per share excluding mark-to-market |
$ | 129.29 | $ | 125.23 | $ | 121.51 | 3.2 | % | 6.4 | % | ||||||||||
Tangible book value per share excluding mark-to-market |
$ | 83.86 | $ | 81.02 | $ | 77.32 | 3.5 | % | 8.5 | % |
(1) | We record the change in the fair value mark and gains (losses) on sales of private equity funds as realized gains (losses) instead of investment income. |
Reconciliation Non-GAAP 3 | Page 31 |
Chubb Limited
Non-GAAP Financial Measures - 4
(in millions of U.S. dollars, except ratios)
(Unaudited)
Regulation G - Non-GAAP Financial Measures (continued)
P&C combined ratio
The P&C combined ratio includes the impact of 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 will impact underwriting results. We view gains and losses on these derivatives as part of the results of our underwriting operations.
The following tables present the calculation of combined ratio, as reported, for each segment to P&C combined ratio, adjusted for catastrophe losses (Cats) and prior period development (PPD).
North | North | North | ||||||||||||||||||||||||||||
America | America | America | Overseas | |||||||||||||||||||||||||||
Commercial P&C | Personal P&C | Agricultural | General | Global | Total | |||||||||||||||||||||||||
Q2 2021 |
Insurance | Insurance | Insurance | Insurance | Reinsurance | Corporate | P&C | |||||||||||||||||||||||
Numerator |
||||||||||||||||||||||||||||||
Losses and loss expenses |
||||||||||||||||||||||||||||||
Losses and loss expenses |
$ | 2,426 | $ | 676 | $ | 334 | $ | 1,186 | $ | 110 | $ | 89 | $ | 4,821 | ||||||||||||||||
Realized (gains) losses on crop derivatives |
| | (3 | ) | | | | (3 | ) | |||||||||||||||||||||
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Adjusted losses and loss expenses |
A | $ | 2,426 | $ | 676 | $ | 331 | $ | 1,186 | $ | 110 | $ | 89 | $ | 4,818 | |||||||||||||||
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Catastrophe losses and related adjustments |
||||||||||||||||||||||||||||||
Catastrophe losses, net of related adjustments |
(165 | ) | (61 | ) | (4 | ) | (40 | ) | (10 | ) | | (280 | ) | |||||||||||||||||
Reinstatement premiums collected (expensed) on catastrophe losses |
| 7 | | | 1 | | 8 | |||||||||||||||||||||||
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Catastrophe losses, gross of related adjustments |
(165 | ) | (68 | ) | (4 | ) | (40 | ) | (11 | ) | | (288 | ) | |||||||||||||||||
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PPD and related adjustments |
||||||||||||||||||||||||||||||
PPD, net of related adjustments - favorable (unfavorable) |
156 | 44 | | 156 | | (88 | ) | 268 | ||||||||||||||||||||||
Net premiums earned adjustments on PPD - unfavorable (favorable) |
11 | | | | | | 11 | |||||||||||||||||||||||
PPD reinstatement premiums - unfavorable (favorable) |
6 | 1 | | 7 | (2 | ) | | 12 | ||||||||||||||||||||||
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PPD, gross of related adjustments - favorable (unfavorable) |
173 | 45 | | 163 | (2 | ) | (88 | ) | 291 | |||||||||||||||||||||
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CAY loss and loss expense ex Cats |
B | $ | 2,434 | $ | 653 | $ | 327 | $ | 1,309 | $ | 97 | $ | 1 | $ | 4,821 | |||||||||||||||
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Policy acquisition costs and administrative expenses |
||||||||||||||||||||||||||||||
Policy acquisition costs and administrative expenses |
C | $ | 734 | $ | 312 | $ | 30 | $ | 978 | $ | 57 | $ | 88 | $ | 2,199 | |||||||||||||||
Expense adjustments - favorable (unfavorable) |
| | | | | | | |||||||||||||||||||||||
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Policy acquisition costs and administrative expenses, adjusted |
D | $ | 734 | $ | 312 | $ | 30 | $ | 978 | $ | 57 | $ | 88 | $ | 2,199 | |||||||||||||||
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Denominator |
||||||||||||||||||||||||||||||
Net premiums earned |
E | $ | 3,803 | $ | 1,224 | $ | 410 | $ | 2,579 | $ | 192 | $ | 8,208 | |||||||||||||||||
Reinstatement premiums (collected) expensed on catastrophe losses |
| (7 | ) | | | (1 | ) | (8 | ) | |||||||||||||||||||||
Net premiums earned adjustments on PPD - unfavorable (favorable) |
11 | | | | | 11 | ||||||||||||||||||||||||
PPD reinstatement premiums - unfavorable (favorable) |
6 | 1 | | 7 | (2 | ) | 12 | |||||||||||||||||||||||
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Net premiums earned excluding adjustments |
F | $ | 3,820 | $ | 1,218 | $ | 410 | $ | 2,586 | $ | 189 | $ | 8,223 | |||||||||||||||||
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P&C combined ratio |
||||||||||||||||||||||||||||||
Loss and loss expense ratio |
A/E | 63.8 | % | 55.2 | % | 80.7 | % | 46.0 | % | 56.8 | % | 58.7 | % | |||||||||||||||||
Policy acquisition cost and administrative expense ratio |
C/E | 19.3 | % | 25.5 | % | 7.4 | % | 37.9 | % | 29.8 | % | 26.8 | % | |||||||||||||||||
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P&C combined ratio |
83.1 | % | 80.7 | % | 88.1 | % | 83.9 | % | 86.6 | % | 85.5 | % | ||||||||||||||||||
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CAY P&C combined ratio ex Cats |
||||||||||||||||||||||||||||||
Loss and loss expense ratio, adjusted |
B/F | 63.7 | % | 53.6 | % | 79.7 | % | 50.6 | % | 50.9 | % | 58.6 | % | |||||||||||||||||
Policy acquisition cost and administrative expense ratio, adjusted |
D/F | 19.2 | % | 25.6 | % | 7.4 | % | 37.8 | % | 30.3 | % | 26.8 | % | |||||||||||||||||
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CAY P&C combined ratio ex Cats |
82.9 | % | 79.2 | % | 87.1 | % | 88.4 | % | 81.2 | % | 85.4 | % | ||||||||||||||||||
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Combined ratio |
||||||||||||||||||||||||||||||
Combined ratio |
85.5 | % | ||||||||||||||||||||||||||||
Add: impact of gains and losses on crop derivatives |
0.0 | % | ||||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||||
P&C combined ratio |
85.5 | % | ||||||||||||||||||||||||||||
|
|
Note: The ratios above are calculated using whole U.S. dollars. Accordingly, calculations using rounded amounts may differ. Letters A, B, C, D, E, and F included in the table are references for calculating the ratios above.
Reconciliation Non-GAAP 4 | Page 32 |
Chubb Limited
Non-GAAP Financial Measures - 5
(in millions of U.S. dollars, except ratios)
(Unaudited)
Regulation G - Non-GAAP Financial Measures (continued)
P&C combined ratio (continued)
North | North | North | ||||||||||||||||||||||||||||||
America | America | America | Overseas | |||||||||||||||||||||||||||||
Commercial P&C | Personal P&C | Agricultural | General | Global | Total | |||||||||||||||||||||||||||
YTD 2021 |
Insurance | Insurance | Insurance | Insurance | Reinsurance | Corporate | P&C | |||||||||||||||||||||||||
Numerator |
||||||||||||||||||||||||||||||||
Losses and loss expenses |
||||||||||||||||||||||||||||||||
Losses and loss expenses |
$ | 4,986 | $ | 1,495 | $ | 418 | $ | 2,449 | $ | 230 | $ | 98 | $ | 9,676 | ||||||||||||||||||
Realized (gains) losses on crop derivatives |
| | (2 | ) | | | | (2 | ) | |||||||||||||||||||||||
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Adjusted losses and loss expenses |
A | $ | 4,986 | $ | 1,495 | $ | 416 | $ | 2,449 | $ | 230 | $ | 98 | $ | 9,674 | |||||||||||||||||
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Catastrophe losses and related adjustments |
||||||||||||||||||||||||||||||||
Catastrophe losses, net of related adjustments |
(527 | ) | (301 | ) | (12 | ) | (90 | ) | (50 | ) | | (980 | ) | |||||||||||||||||||
Reinstatement premiums collected (expensed) on catastrophe losses |
| (16 | ) | | | 6 | | (10 | ) | |||||||||||||||||||||||
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Catastrophe losses, gross of related adjustments |
(527 | ) | (285 | ) | (12 | ) | (90 | ) | (56 | ) | | (970 | ) | |||||||||||||||||||
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|||||||||||||||||||
PPD and related adjustments |
||||||||||||||||||||||||||||||||
PPD, net of related adjustments - favorable (unfavorable) |
283 | 84 | 2 | 181 | 7 | (97 | ) | 460 | ||||||||||||||||||||||||
Net premiums earned adjustments on PPD - unfavorable (favorable) |
11 | | (2 | ) | | | | 9 | ||||||||||||||||||||||||
Expense adjustments - unfavorable (favorable) |
3 | | | | | | 3 | |||||||||||||||||||||||||
PPD reinstatement premiums - unfavorable (favorable) |
6 | 1 | | 7 | 1 | | 15 | |||||||||||||||||||||||||
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|||||||||||||||||||
PPD, gross of related adjustments - favorable (unfavorable) |
303 | 85 | | 188 | 8 | (97 | ) | 487 | ||||||||||||||||||||||||
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CAY loss and loss expense ex Cats |
B | $ | 4,762 | $ | 1,295 | $ | 404 | $ | 2,547 | $ | 182 | $ | 1 | $ | 9,191 | |||||||||||||||||
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Policy acquisition costs and administrative expenses |
||||||||||||||||||||||||||||||||
Policy acquisition costs and administrative expenses |
C | $ | 1,502 | $ | 619 | $ | 45 | $ | 1,912 | $ | 110 | $ | 159 | $ | 4,347 | |||||||||||||||||
Expense adjustments - favorable (unfavorable) |
(3 | ) | | | | | | (3 | ) | |||||||||||||||||||||||
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Policy acquisition costs and administrative expenses, adjusted |
D | $ | 1,499 | $ | 619 | $ | 45 | $ | 1,912 | $ | 110 | $ | 159 | $ | 4,344 | |||||||||||||||||
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Denominator |
||||||||||||||||||||||||||||||||
Net premiums earned |
E | $ | 7,477 | $ | 2,408 | $ | 520 | $ | 5,057 | $ | 372 | $ | 15,834 | |||||||||||||||||||
Reinstatement premiums (collected) expensed on catastrophe losses |
| 16 | | | (6 | ) | 10 | |||||||||||||||||||||||||
Net premiums earned adjustments on PPD - unfavorable (favorable) |
11 | | (2 | ) | | | 9 | |||||||||||||||||||||||||
PPD reinstatement premiums - unfavorable (favorable) |
6 | 1 | | 7 | 1 | 15 | ||||||||||||||||||||||||||
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Net premiums earned excluding adjustments |
F | $ | 7,494 | $ | 2,425 | $ | 518 | $ | 5,064 | $ | 367 | $ | 15,868 | |||||||||||||||||||
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P&C combined ratio |
||||||||||||||||||||||||||||||||
Loss and loss expense ratio |
A/E | 66.7 | % | 62.1 | % | 80.0 | % | 48.4 | % | 61.7 | % | 61.1 | % | |||||||||||||||||||
Policy acquisition cost and administrative expense ratio |
C/E | 20.1 | % | 25.7 | % | 8.7 | % | 37.8 | % | 29.6 | % | 27.5 | % | |||||||||||||||||||
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|||||||||||||||||||||
P&C combined ratio |
86.8 | % | 87.8 | % | 88.7 | % | 86.2 | % | 91.3 | % | 88.6 | % | ||||||||||||||||||||
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CAY P&C combined ratio ex Cats |
||||||||||||||||||||||||||||||||
Loss and loss expense ratio, adjusted |
B/F | 63.6 | % | 53.4 | % | 77.9 | % | 50.3 | % | 49.6 | % | 57.9 | % | |||||||||||||||||||
Policy acquisition cost and administrative expense ratio, adjusted |
D/F | 20.0 | % | 25.5 | % | 8.7 | % | 37.8 | % | 30.0 | % | 27.4 | % | |||||||||||||||||||
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CAY P&C combined ratio ex Cats |
83.6 | % | 78.9 | % | 86.6 | % | 88.1 | % | 79.6 | % | 85.3 | % | ||||||||||||||||||||
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Combined ratio |
||||||||||||||||||||||||||||||||
Combined ratio |
88.6 | % | ||||||||||||||||||||||||||||||
Add: impact of gains and losses on crop derivatives |
0.0 | % | ||||||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||||||
P&C combined ratio |
88.6 | % | ||||||||||||||||||||||||||||||
|
|
Note: The ratios above are calculated using whole U.S. dollars. Accordingly, calculations using rounded amounts may differ. Letters A, B, C, D, E, and F included in the table are references for calculating the ratios above.
Reconciliation Non-GAAP 5 | Page 33 |
Chubb Limited
Non-GAAP Financial Measures - 6
(in millions of U.S. dollars, except ratios)
(Unaudited)
Regulation G - Non-GAAP Financial Measures (continued)
P&C combined ratio (continued)
North | North | North | ||||||||||||||||||||||||||||||
America | America | America | Overseas | |||||||||||||||||||||||||||||
Commercial P&C | Personal P&C | Agricultural | General | Global | Total | |||||||||||||||||||||||||||
Q2 2020 |
Insurance | Insurance | Insurance | Insurance | Reinsurance | Corporate | P&C | |||||||||||||||||||||||||
Numerator |
||||||||||||||||||||||||||||||||
Losses and loss expenses |
||||||||||||||||||||||||||||||||
Losses and loss expenses |
$ | 3,498 | $ | 762 | $ | 312 | $ | 1,485 | $ | 73 | $ | 276 | $ | 6,406 | ||||||||||||||||||
Realized (gains) losses on crop derivatives |
| | 1 | | | | 1 | |||||||||||||||||||||||||
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Adjusted losses and loss expenses |
A | $ | 3,498 | $ | 762 | $ | 313 | $ | 1,485 | $ | 73 | $ | 276 | $ | 6,407 | |||||||||||||||||
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Catastrophe losses and related adjustments |
||||||||||||||||||||||||||||||||
Catastrophe losses, net of related adjustments |
(1,273 | ) | (110 | ) | (6 | ) | (399 | ) | (13 | ) | | (1,801 | ) | |||||||||||||||||||
Reinstatement premiums collected (expensed) on catastrophe losses |
(3 | ) | (1 | ) | | (16 | ) | | | (20 | ) | |||||||||||||||||||||
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Catastrophe losses, gross of related adjustments |
(1,270 | ) | (109 | ) | (6 | ) | (383 | ) | (13 | ) | | (1,781 | ) | |||||||||||||||||||
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PPD and related adjustments |
||||||||||||||||||||||||||||||||
PPD, net of related adjustments - favorable (unfavorable) |
146 | 1 | | 36 | 16 | (274 | ) | (75 | ) | |||||||||||||||||||||||
Net premiums earned adjustments on PPD - unfavorable (favorable) |
4 | | | | | | 4 | |||||||||||||||||||||||||
Expense adjustments - unfavorable (favorable) |
1 | | | | | | 1 | |||||||||||||||||||||||||
PPD reinstatement premiums - unfavorable (favorable) |
| | | | (1 | ) | | (1 | ) | |||||||||||||||||||||||
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PPD, gross of related adjustments - favorable (unfavorable) |
151 | 1 | | 36 | 15 | (274 | ) | (71 | ) | |||||||||||||||||||||||
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CAY loss and loss expense ex Cats |
B | $ | 2,379 | $ | 654 | $ | 307 | $ | 1,138 | $ | 75 | $ | 2 | $ | 4,555 | |||||||||||||||||
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Policy acquisition costs and administrative expenses |
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Policy acquisition costs and administrative expenses |
C | $ | 720 | $ | 297 | $ | 32 | $ | 865 | $ | 51 | $ | 77 | $ | 2,042 | |||||||||||||||||
Expense adjustments - favorable (unfavorable) |
(1 | ) | | | | | | (1 | ) | |||||||||||||||||||||||
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Policy acquisition costs and administrative expenses, adjusted |
D | $ | 719 | $ | 297 | $ | 32 | $ | 865 | $ | 51 | $ | 77 | $ | 2,041 | |||||||||||||||||
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Denominator |
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Net premiums earned |
E | $ | 3,595 | $ | 1,192 | $ | 376 | $ | 2,194 | $ | 163 | $ | 7,520 | |||||||||||||||||||
Reinstatement premiums (collected) expensed on catastrophe losses |
3 | 1 | | 16 | | 20 | ||||||||||||||||||||||||||
Net premiums earned adjustments on PPD - unfavorable (favorable) |
4 | | | | | 4 | ||||||||||||||||||||||||||
PPD reinstatement premiums - unfavorable (favorable) |
| | | | (1 | ) | (1 | ) | ||||||||||||||||||||||||
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Net premiums earned excluding adjustments |
F | $ | 3,602 | $ | 1,193 | $ | 376 | $ | 2,210 | $ | 162 | $ | 7,543 | |||||||||||||||||||
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P&C combined ratio |
||||||||||||||||||||||||||||||||
Loss and loss expense ratio |
A/E | 97.3 | % | 63.8 | % | 83.1 | % | 67.7 | % | 45.5 | % | 85.2 | % | |||||||||||||||||||
Policy acquisition cost and administrative expense ratio |
C/E | 20.0 | % | 25.0 | % | 8.7 | % | 39.4 | % | 31.1 | % | 27.1 | % | |||||||||||||||||||
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P&C combined ratio |
117.3 | % | 88.8 | % | 91.8 | % | 107.1 | % | 76.6 | % | 112.3 | % | ||||||||||||||||||||
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CAY P&C combined ratio ex Cats |
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Loss and loss expense ratio, adjusted |
B/F | 66.1 | % | 54.7 | % | 81.5 | % | 51.6 | % | 46.8 | % | 60.4 | % | |||||||||||||||||||
Policy acquisition cost and administrative expense ratio, adjusted |
D/F | 19.9 | % | 24.9 | % | 8.7 | % | 39.1 | % | 31.4 | % | 27.0 | % | |||||||||||||||||||
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CAY P&C combined ratio ex Cats |
86.0 | % | 79.6 | % | 90.2 | % | 90.7 | % | 78.2 | % | 87.4 | % | ||||||||||||||||||||
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Combined ratio |
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Combined ratio |
112.3 | % | ||||||||||||||||||||||||||||||
Add: impact of gains and losses on crop derivatives |
0.0 | % | ||||||||||||||||||||||||||||||
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P&C combined ratio |
112.3 | % | ||||||||||||||||||||||||||||||
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Note: The ratios above are calculated using whole U.S. dollars. Accordingly, calculations using rounded amounts may differ. Letters A, B, C, D, E, and F included in the table are references for calculating the ratios above.
Reconciliation Non-GAAP 6 | Page 34 |
Chubb Limited
Non-GAAP Financial Measures - 7
(in millions of U.S. dollars, except ratios)
(Unaudited)
Regulation G - Non-GAAP Financial Measures (continued)
P&C combined ratio (continued)
North | North | North | ||||||||||||||||||||||||||||||
America | America | America | Overseas | |||||||||||||||||||||||||||||
Commercial P&C | Personal P&C | Agricultural | General | Global | Total | |||||||||||||||||||||||||||
YTD 2020 |
Insurance | Insurance | Insurance | Insurance | Reinsurance | Corporate | P&C | |||||||||||||||||||||||||
Numerator |
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Losses and loss expenses |
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Losses and loss expenses |
$ | 5,679 | $ | 1,445 | $ | 375 | $ | 2,743 | $ | 160 | $ | 287 | $ | 10,689 | ||||||||||||||||||
Realized (gains) losses on crop derivatives |
| | 3 | | | | 3 | |||||||||||||||||||||||||
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Adjusted losses and loss expenses |
A | $ | 5,679 | $ | 1,445 | $ | 378 | $ | 2,743 | $ | 160 | $ | 287 | $ | 10,692 | |||||||||||||||||
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Catastrophe losses and related adjustments |
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Catastrophe losses, net of related adjustments |
(1,391 | ) | (131 | ) | (14 | ) | (489 | ) | (13 | ) | | (2,038 | ) | |||||||||||||||||||
Reinstatement premiums collected (expensed) on catastrophe losses |
(3 | ) | (1 | ) | | (16 | ) | | | (20 | ) | |||||||||||||||||||||
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Catastrophe losses, gross of related adjustments |
(1,388 | ) | (130 | ) | (14 | ) | (473 | ) | (13 | ) | | (2,018 | ) | |||||||||||||||||||
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PPD and related adjustments |
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PPD, net of related adjustments - favorable (unfavorable) |
251 | | 14 | 40 | 23 | (285 | ) | 43 | ||||||||||||||||||||||||
Net premiums earned adjustments on PPD - unfavorable (favorable) |
4 | | 3 | | | | 7 | |||||||||||||||||||||||||
PPD reinstatement premiums - unfavorable (favorable) |
| | | | (1 | ) | | (1 | ) | |||||||||||||||||||||||
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PPD, gross of related adjustments - favorable (unfavorable) |
255 | | 17 | 40 | 22 | (285 | ) | 49 | ||||||||||||||||||||||||
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CAY loss and loss expense ex Cats |
B | $ | 4,546 | $ | 1,315 | $ | 381 | $ | 2,310 | $ | 169 | $ | 2 | $ | 8,723 | |||||||||||||||||
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Policy acquisition costs and administrative expenses |
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Policy acquisition costs and administrative expenses |
C | $ | 1,471 | $ | 610 | $ | 47 | $ | 1,765 | $ | 106 | $ | 143 | $ | 4,142 | |||||||||||||||||
Expense adjustments - favorable (unfavorable) |
| | | | | | | |||||||||||||||||||||||||
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Policy acquisition costs and administrative expenses, adjusted |
D | $ | 1,471 | $ | 610 | $ | 47 | $ | 1,765 | $ | 106 | $ | 143 | $ | 4,142 | |||||||||||||||||
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Denominator |
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Net premiums earned |
E | $ | 6,971 | $ | 2,392 | $ | 470 | $ | 4,501 | $ | 349 | $ | 14,683 | |||||||||||||||||||
Reinstatement premiums (collected) expensed on catastrophe losses |
3 | 1 | | 16 | | 20 | ||||||||||||||||||||||||||
Net premiums earned adjustments on PPD - unfavorable (favorable) |
4 | | 3 | | | 7 | ||||||||||||||||||||||||||
PPD reinstatement premiums - unfavorable (favorable) |
| | | | (1 | ) | (1 | ) | ||||||||||||||||||||||||
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Net premiums earned excluding adjustments |
F | $ | 6,978 | $ | 2,393 | $ | 473 | $ | 4,517 | $ | 348 | $ | 14,709 | |||||||||||||||||||
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|
|||||||||||||||||||||
P&C combined ratio |
||||||||||||||||||||||||||||||||
Loss and loss expense ratio |
A/E | 81.5 | % | 60.4 | % | 80.4 | % | 61.0 | % | 46.0 | % | 72.8 | % | |||||||||||||||||||
Policy acquisition cost and administrative expense ratio |
C/E | 21.1 | % | 25.5 | % | 10.0 | % | 39.2 | % | 30.3 | % | 28.2 | % | |||||||||||||||||||
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|
|||||||||||||||||||||
P&C combined ratio |
102.6 | % | 85.9 | % | 90.4 | % | 100.2 | % | 76.3 | % | 101.0 | % | ||||||||||||||||||||
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|
|||||||||||||||||||||
CAY P&C combined ratio ex Cats |
||||||||||||||||||||||||||||||||
Loss and loss expense ratio, adjusted |
B/F | 65.2 | % | 54.9 | % | 80.4 | % | 51.2 | % | 48.7 | % | 59.3 | % | |||||||||||||||||||
Policy acquisition cost and administrative expense ratio, adjusted |
D/F | 21.0 | % | 25.5 | % | 10.0 | % | 39.0 | % | 30.5 | % | 28.2 | % | |||||||||||||||||||
|
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|
|
|
|
|
|||||||||||||||||||||
CAY P&C combined ratio ex Cats |
86.2 | % | 80.4 | % | 90.4 | % | 90.2 | % | 79.2 | % | 87.5 | % | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Combined ratio |
||||||||||||||||||||||||||||||||
Combined ratio |
101.0 | % | ||||||||||||||||||||||||||||||
Add: impact of gains and losses on crop derivatives |
0.0 | % | ||||||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||||||
P&C combined ratio |
101.0 | % | ||||||||||||||||||||||||||||||
|
|
Note: The ratios above are calculated using whole U.S. dollars. Accordingly, calculations using rounded amounts may differ. Letters A, B, C, D, E, and F included in the table are references for calculating the ratios above.
Reconciliation Non-GAAP 7 | Page 35 |
Chubb Limited
Glossary
Chubb Limited Consolidated comprises all segments including Corporate.
P&C combined ratio: The sum of the loss and loss expense ratio, policy acquisition cost ratio and the administrative expense ratio excluding the life business and including the realized gains and losses on the crop derivatives.
Book value per common share: Shareholders equity divided by the shares outstanding.
Tangible book value per common share: Shareholders equity less goodwill and other intangible assets, net of tax, divided by the shares outstanding.
Average market yield of fixed maturities: Weighted average yield to maturity of our fixed income portfolio based on the market prices of the holdings as of that date.
Average yield on invested assets: Adjusted net investment income divided by average cost of fixed maturities and other investments, and average market value of equity securities.
Total capitalization: The sum of the short-term debt, long-term debt, trust preferreds, and shareholders equity.
Catastrophe losses (Cats): We generally define catastrophe loss events consistent with the definition of the Property Claims Service (PCS) for events in the U.S. and Canada. PCS defines a catastrophe as an event that causes damage of $25 million or more in insured losses and affects a significant number of insureds, including from pandemics such as COVID-19. For events outside of the U.S. and Canada, we generally use a similar definition. Catastrophe loss events are events that occurred in the current calendar year only. Changes in catastrophe loss estimates in the current calendar year that relate to loss events that occurred in previous calendar years are considered prior period development.
Prior period development (PPD) arises from changes to loss estimates recognized in the current year that relate to loss events that occurred in previous calendar years and excludes the effect of losses from the development of earned premium from previous accident years.
Reinstatement premiums are additional premiums paid on certain reinsurance agreements in order to reinstate coverage that had been exhausted by loss occurrences. The reinstatement premium amount is typically a pro rata portion of the original ceded premium paid based on how much of the reinsurance limit had been exhausted.
Net premiums earned adjustments within prior period development are adjustments to the initial premium earned on retrospectively rated policies based on actual claim experience that develops after the policy period ends. The premium adjustments correlate to the prior period loss development on these same policies and are fully earned in the period the adjustments are recorded.
Prior period expense adjustments typically relate to either profit commission reserves or policyholder dividend reserves based on actual claim experience that develops after the policy period ends. The expense adjustments correlate to the prior period loss development on these same policies.
Segment income (loss) includes underwriting income (loss), adjusted net investment income, other income (expense) operating, and amortization expense of purchased intangibles.
Commercial P&C lines includes Commercial P&C, Agriculture and Reinsurance lines of business.
Consumer P&C lines includes Personal and Global accident and health (A&H) lines of business.
NM: Not meaningful.
Glossary | Page 36 |
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