Chubb(US:CB)2024-10-30 17:30Financial Performance - Net income attributable to Chubb was $2.3 billion, up 21.9% from $2.0 billion in the prior year period, driven by strong underwriting results and record net investment income [205]. - Consolidated net premiums written were $13.8 billion, an increase of 5.5%, or 6.6% in constant dollars, with commercial insurance up 5.1% and consumer insurance up 9.4% [206]. - Total revenues increased to $14.8 billion, up 7.2% from $13.9 billion in the prior year [204]. - Operating cash flow was $4.3 billion, down from $4.7 billion in the prior year period [211]. - The total consolidated net premiums earned increased by $3.4 billion, or 10.2%, for the nine months ended September 30, 2024, compared to the same period last year [217]. - The company reported a favorable PPD adjustment of $643 million, contributing positively to net premiums earned [303]. - The company anticipates continued growth in net premiums earned, driven by strategic market expansions and product innovations [304]. Investment Income - Pre-tax net investment income reached a record $1.5 billion, a 14.7% increase from $1.3 billion in the prior year period, primarily due to strong operating cash flow and higher reinvestment rates [207]. - Net investment income increased by 14.7% to $1,508 million for the three months ended September 30, 2024, and by 22.5% to $4,367 million for the nine months ended September 30, 2024, primarily due to higher reinvestment rates on fixed maturities and the consolidation of Huatai Group [310]. - The total mark-to-market gain on private equity was $170 million for the three months ended September 30, 2024, compared to $90 million for the same period in 2023 [312]. Catastrophe Losses - Total pre-tax catastrophe losses were $765 million, contributing 6.4 percentage points to the P&C combined ratio, compared to $670 million and 6.0 percentage points in the prior year [208]. - Catastrophe losses for the three months ended September 30, 2024, were $765 million, compared to $670 million in the same period last year, primarily due to severe weather-related events [219]. - Catastrophe losses for Q3 2024 were $340 million, compared to $246 million in Q3 2023, with significant losses attributed to flooding, hail, tornadoes, and winter storms [234]. Combined Ratio - The P&C combined ratio improved to 87.7% from 88.4% in the prior year, with the current accident year combined ratio excluding catastrophe losses at 83.4% [210]. - The combined ratio for Q3 2024 was 86.5%, up from 84.2% in Q3 2023, reflecting higher catastrophe losses and lower favorable prior period development [238]. - The combined ratio for Q3 2024 was 94.4%, an increase from 81.3% in Q3 2023, primarily due to higher catastrophe losses [266]. Policy Benefits and Premiums - Policy benefits rose to $1.1 billion, a 17.1% increase from $938 million in the prior year [210]. - Life insurance premiums increased by 6.8% to $1.6 billion for the three months ended September 30, 2024, driven by strong growth in Asia and the consolidation of Huatai Group's life business [213][215]. - Policy benefits increased to $1,099 million for Q3 2024, up from $938 million in Q3 2023, and $3,498 million for the nine months ended September 30, 2024, compared to $2,565 million in the same period of 2023, primarily due to the consolidation of Huatai Group [229]. Shareholder Equity and Dividends - Chubb's shareholders' equity increased by $4.7 billion in the quarter, driven by net income of $2.3 billion and net unrealized gains of $3.3 billion from the investment portfolio, partially offset by $782 million returned to shareholders [212]. - The annual dividend approved in May 2024 was $3.64 per share, representing a $0.20 per share increase over the prior year dividend [347]. Acquisitions and Consolidation - The company completed the acquisition of a controlling majority interest in Huatai Group on July 1, 2023, with its results included in the consolidated results from the acquisition date [203]. - The Life Insurance segment now includes 100% of Huatai Group's life and asset management business effective July 1, 2023, impacting overall results [273]. Debt and Financing - Total financial debt increased to $16.131 billion as of September 30, 2024, compared to $14.495 billion at December 31, 2023, reflecting a rise in long-term debt from $13.035 billion to $14.560 billion [342]. - Cash used for financing decreased to $0.1 billion in the nine months ended September 30, 2024, from $3.3 billion in the prior year, primarily due to net proceeds from long-term debt issuance [354]. Risk Management - The company actively manages catastrophe risk accumulation and utilizes sophisticated modeling techniques to assess potential losses [333]. - The U.S. hurricane modeled losses for a 1-in-100 return period could exceed $3,786 million, or 5.8% of total Chubb shareholders' equity [335]. Operational Efficiency - The loss and loss expense ratio for the P&C segment was 62.9%, reflecting a slight improvement from the previous year [304]. - Administrative expenses increased by $6 million (6.5%) for the three months and by $20 million (7.0%) for the nine months ended September 30, 2024, primarily due to increased spending on digital growth initiatives [282].