Chubb reports a Q2 loss, argues COVID-19 has overshadowed its underlying strength
Chubb has reported a loss for Q2 2020, blaming the COVID-19 pandemic for a year on year collapse in profitability and stressing the underlying health of the company and the balance sheet.
Chubb reported a net loss of $331 million for Q2, having generated profit of $1.15 billion in the same period of 2019.
It reported net catastrophe losses of $1.51 billion after tax, of which nearly $1.16 billion related to COVID-19.
Consolidated net premiums written were $8.4 billion, up 0.1 percent year on year. For P&C specifically, net premiums written were $7.7 billion, down 0.4 percent. Net premiums written in the quarter were reduced by $191 million from COVID-19 exposure adjustments on in-force policies.
The P&C combined ratio was 112.3 percent, up from 90.1 percent in the same period of 2019. The P&C current accident year combined ratio, excluding catastrophe losses, was 87.4 percent, compared with 88.9 percent the previous year.
Evan Greenberg, chairman and chief executive officer at Chubb, admitted it had been “a difficult quarter for Chubb,” arguing COVID-19 had undermined earnings and growth and “overshadowed the core underlying strength and vitality of our company.”
Chubb’s balance sheet is in excellent shape, Greenberg said. “We are growing our exposures and market share, taking advantage of commercial P&C underwriting conditions where rates in many classes continued to rise in both North America and our international operations,” he added.
Greenberg observed that hard or hardening market conditions are spreading globally to more territories and classes at varying speeds, which he said was a rational response to prolonged overly competitive industry market conditions and the loss cost environment.
