Chubb combined ratio rises to 84.1% on $705m of catastrophe losses
Chief executive Evan Greenberg said competition in commercial lines is building in London as well as the US.
Chubb reported a third-quarter property and casualty combined ratio of 84.1%, up from 81.8% a year earlier, as pre-tax catastrophe losses rose to $705m from $285m, the insurer said on 20 October.
Chubb's chief executive said competition is building in London as well as the US, and that the group is cutting business where rates or terms fall short.
Net income rose 1.5% to $2.84bn, while net income per share rose 4.4% to $7.30. Core operating income fell 2.2% to $2.98bn, but core operating income per share rose 0.8% to $7.66. P&C underwriting income fell 8.8% to $2.06bn. On a current accident year basis excluding catastrophes, the combined ratio was 82.6%, against 82.5%.
Consolidated net premiums written rose 1.9% to $15.1bn. North America Commercial fell 2.7%, which Chubb linked to reduced exposure, more reinsurance and underwriting-related non-renewals, mainly in property and financial lines. Overseas General grew 6.7%, with Europe up 6.8%.
Rival Travelers reported a third-quarter combined ratio of 86.8% on 16 October, with an underlying ratio of 84.1% (Travelers), and has been ceding more cyber premium to reinsurers.
"While the market continues to grow more competitive in commercial P&C across the board, particularly in the U.S. and London, the substantial majority of our underwriting businesses grew in the quarter, with the balance flat or purposely shrinking due to inadequate pricing or terms," said Evan G. Greenberg, chairman and chief executive.
Adjusted net investment income reached a record $1.89bn. Greenberg said Strategic Holdings, Chubb's holding company partnership with KKR, agreed to sell its investment in USI Insurance Services to Aon, which is expected to produce a realised gain of $460m on a $740m investment.
Greenberg said he expects North America commercial growth to improve in future quarters.
Related coverage: Marsh says Broker Workbench cuts London placement processing to hours and Lloyd's takes strategic stake in aviation data platform Asterias.
Sources
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