Chubb Ltd ((CB)) has held its Q3 earnings call. Read on for the main highlights of the call.
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Chubb Ltd’s recent earnings call showcased a positive sentiment, driven by strong financial performance. The company reported record earnings, robust premium growth, and increased investment income, despite facing challenges in property pricing and adverse development in long-tail lines. Overall, the positive highlights significantly outweighed the lowlights, reflecting a strong quarter for Chubb.
Record Earnings Quarter
Chubb Ltd reported a record quarter with core operating income reaching $3 billion, marking a 29% increase. This impressive performance led to an earnings per share (EPS) of $7.49, up 31% from the previous year. The company’s underwriting income also hit a record $2.3 billion, a 55% increase, with a combined ratio of 81.8%.
Strong Premium Growth
The company experienced a 7.5% growth in total premiums, with consumer premiums rising by nearly 16% and commercial premiums by 3.3%. The Life Insurance division saw a remarkable growth of over 24.5%, highlighting the company’s strong market presence.
Robust Investment Income
Chubb’s adjusted net investment income reached a record $1.8 billion, an 8.3% increase. The fixed income portfolio yield stood at 5.1%, with new money rates averaging 5.2%, showcasing the company’s effective investment strategies.
Increased Share Buybacks
During the quarter, Chubb returned $1.6 billion to shareholders, including $1.2 billion in share repurchases. This move underscores the company’s commitment to enhancing shareholder value.
Tangible Book Value Growth
Chubb reported a tangible book value growth of 17% per share year-over-year and 6.6% from the previous quarter, reflecting the company’s strong financial health and strategic investments.
Strong International Growth
The company’s international business saw significant growth, with premiums in the Overseas General division up 9.7%. Asia led the way with over 14% growth, followed by Latin America at over 10.5%, and Europe at almost 5%.
Property Pricing Challenges
Chubb faced challenges in property pricing, with rates down 3.3% in North America and a 13.5% decrease in large account business in E&S. This indicates a competitive market environment.
Adverse Development in Long-tail Lines
The company reported an unfavorable pretax prior period development of $38 million in long-tail lines, primarily due to environmental-related issues.
North America Casualty Development
Chubb experienced a $38 million negative overall casualty development, with a $104 million negative impact in the U.S., partially offset by a $66 million positive impact internationally.
Forward-Looking Guidance
Chubb’s forward-looking guidance remains optimistic, with expectations of continued growth across regions and customer segments. The company highlighted its diversified approach as a key driver of success, with premium revenue growth projected at 7.5%. Chubb also anticipates further strengthening of its tangible book value and investment income.
In summary, Chubb Ltd’s earnings call reflected a positive outlook, with record earnings and strong growth across various segments. Despite some challenges, the company’s strategic investments and diversified approach position it well for future success.