Despite ‘Difficult’ Environment, Chubb Q1 Profit Tops $1 Billion

Chubb Limited reported net income for the quarter of $1.09 billion, compared with $439 million for the same quarter last year. Operating income was $1.17 billion, compared with $1.01 billion, for the same quarter last year.

The insurer’s property/casualty (P&C) combined ratio was 87.5 for the quarter.

“Chubb had a very good quarter,” said Evan G. Greenberg, chairman and chief executive officer, citing strong growth in both underwriting (9 percent) and investment (3 percent) income.

“Our underwriting income growth was driven by combined ratios that were simply excellent in the quarter on both a calendar and accident-year basis in spite of elevated natural catastrophe losses and a one-time reserve charge related to the change in the Ogden discount rate in the U.K. Our underwriting margins are benefiting in particular from expense efficiencies generated from the merger,” Greenberg said in prepared remarks.

Evan Greenberg

“The market is soft and companies are chasing volume in spite of a difficult underwriting environment,” he continued. “Our premium revenue growth was in line with our expectations and benefited from strong business retentions and growth in new business over prior year, which was constrained nonetheless due to competitive P&C conditions globally.”

In a call with analysts, Greenberg said the company is ahead of its schedule on realization of about $800 million in expense savings as a result of the ACE-Chubb marriage and the company would provide an update on those savings at the end of the second quarter.

Other highlights from Chubb’s first quarter results: