Chubb’s net income falls 46% to $1.2b

Chubb has reported a net income for the second quarter of $1.22 billion, a 46% year-on-year fall from $2.27 billion on realised losses of $565 million after tax, principally due to the mark-to-market impact on private and public equities and from sales in fixed income securities.

The P&C combined ratio was 84.0% compared to 85.5% prior year, and the current accident year P&C combined ratio excluding catastrophe losses was 83.5% compared to 85.4% prior year.

For the six months ended 30 June, net income was $3.19 billion, a 30% decrease compared with the same period of last year.

The P&C combined ratio was 84.2% compared to 88.6% prior year, and the current accident year P&C combined ratio excluding catastrophe losses was 83.5% compared to 85.3% prior year.

Evan Greenberg, Chubb’s chairman and chief executive officer, said: "We had an outstanding quarter that reflects the strong momentum in our company: record operating earnings, underwriting and investment results, and double-digit premium revenue growth in constant dollars. Core operating income per share was $4.20, up 16%; P&C underwriting income topped $1.4 billion, up over 21%, with a combined ratio of 84%; and adjusted net investment income was $950 million – all were records.

“"Total P&C premiums globally grew 11% in constant dollars, with commercial up 12% and consumer up 8%, though published growth was impacted by the headwinds from the strength of the dollar. Commercial P&C pricing changes remained strong and exceeded both our actual observed and future projected loss cost trends. Commercial premiums increased 12.5% in North America, or 8.7% excluding agriculture, and 13% in our international operations in constant dollars. On the consumer side, our international business continued to pick up momentum, with constant dollar growth of 11.6%, while our U.S. high net worth business grew 4.7% on the back of record new business and strong pricing.

"We are bullish about our future prospects while mindful of the world around us. We are in the risk business. Our momentum and earning power are strong, driven by commercial P&C growth and pricing that remain quite good; increasing investment income due to rising rates and strong cash flow; accelerating consumer lines growth globally; and life company revenue and earnings which will benefit from the addition of Cigna's business in Asia. Together, these will continue to drive strong EPS growth."