Chubb NYSE: CB executives highlighted what Chairman and CEO Evan Greenberg described as an “excellent quarter and start to the year,” pointing to growth across property and casualty (P&C), investments and life insurance while also emphasizing underwriting discipline amid what he called “elevated uncertainty.”
Quarterly performance and balance sheet updates
Greenberg said strong growth in underwriting, investment and life income drove core operating earnings of $2.7 billion, or $6.82 per share, “both up substantially” from the prior-year quarter, which he noted was impacted by the California wildfires. Excluding catastrophe losses, Greenberg said core operating income increased 10.7% and core operating earnings per share rose 13.5%.
He also highlighted capital growth, saying tangible book value per share increased 21.5% in the quarter.
On underwriting, Greenberg reported P&C underwriting income of $1.8 billion and a combined ratio of 84%. On a current accident year basis excluding catastrophe losses, he said underwriting income grew 9.8% and the combined ratio was 82.1%.
Chief Financial Officer Peter Enns said the quarter ended with “record cash and invested assets,” citing nearly $173 billion of cash and invested assets and $3.8 billion of adjusted operating cash flow. Enns also noted the company issued 200 million Swiss francs (approximately $250 million) of six-year debt at a 1% cost.
Enns said Chubb returned $1.5 billion of capital to shareholders in the quarter, including $1.1 billion of share repurchases (average price $325.06) and $380 million in dividends. He reported book value ended at nearly $74 billion, or $189.93 per share, and said book value per share and tangible book value per share, excluding AOCI, increased 12.1% and 16.5% year over year, respectively.
Premium growth and underwriting trends
Total company net premiums grew 10.7% to more than $14 billion, Greenberg said. P&C premiums increased 7.2%, while life premiums grew more than 33%, with both benefiting from foreign exchange.
Greenberg broke down growth by segment and geography:
- P&C: Consumer premiums rose 14.2% and commercial premiums increased 4.6%.
- Overseas general: Premiums grew 14.4%, or 6.1% in constant dollars.
- North America: Total premiums were up 4.1%, or 7.8% excluding large account property that Chubb “purposely shrank” due to what Greenberg said were inadequate pricing levels.
In international P&C, Greenberg said premiums in the company’s international retail business—operating in 51 countries and representing about 90% of overseas general—rose more than 15%. Consumer-related premiums were up over 20% and commercial lines increased over 11%. Regionally, Europe grew 17.5%, Asia grew more than 12% and Latin America rose almost 18%.
Greenberg said pricing in international retail commercial softened, with P&C rates down 2.5% and financial lines rates down 7.4%. He also reported selected loss cost trends in the international retail business of 3.7%, “or 130 basis points lower than 25.”
In the London wholesale business, Greenberg said competition intensified, “particularly, but not only in property,” and Chubb “purposely shrank” open market property. He said London wholesale premiums increased almost 8%.
In North America, Greenberg said total premiums grew 4.1%, including 8.3% in personal lines and 2.8% in commercial. Excluding shared and layered property that Chubb reduced, he said total North America commercial premiums increased 7.7%.
Greenberg also provided detailed pricing commentary for North America commercial lines. He said commercial property and casualty pricing (excluding financial lines and workers’ compensation) increased 4.6%, comprised of 2.2% rate and 2.3% exposure change. Property pricing declined 2.6% overall, with rates down 6.3% and exposures up 4%. For the shared and layered property business Chubb wrote, he said property pricing was down 14.3%, while pricing for business the company “gave up or passed on” was down 30% to 40%.
By contrast, Greenberg said middle market and small commercial property pricing increased 1.5%, and casualty pricing in North America rose 9.6% (rates up 8.4% and exposure up 1.1%). He said workers’ compensation pricing increased 4.3% and financial lines pricing was “about flat.”
On personal lines, Greenberg said the high net-worth business posted premium growth of 8.3% and renewal retention of 92% on an account basis, with homeowners pricing up 7.7%.
Catastrophe losses, reserve development and investment income
Enns said pre-tax catastrophe losses were $500 million, “principally from weather-related events,” split 87% U.S. and 13% international.
He reported favorable pre-tax prior period development of $301 million in the company’s active businesses, including $322 million of favorable development in short-tail lines and $21 million of unfavorable development in long-tail lines. The corporate runoff portfolio had $15 million of adverse development, he said.
Enns also provided reserve and claims metrics, including a paid-to-incurred ratio of 87% and net loss reserves of nearly $69 billion, representing 5% growth from the prior year’s first quarter.
On investments, Greenberg said adjusted net investment income was $1.8 billion, up more than 10%, with fixed income portfolio yield at 5.1% and a current new money rate average of 5.5% as of March 31. He also said invested assets rose to $170 billion from $152 billion a year earlier.
Enns said adjusted net investment income was $1.84 billion, “at the top end of our previously guided range,” attributing the result primarily to a larger invested asset base and stronger private equity returns. He guided adjusted net investment income for the second quarter to a range of $1.825 billion to $1.85 billion.
Enns said the core operating effective tax rate was 19.3% in the quarter, slightly below prior guidance due to compensation-related equity awards that vested in the first quarter, and reiterated expectations for a full-year core operating effective tax rate of 19.5% to 20%.
Market conditions: property pricing, competition and reinsurance
Greenberg repeatedly emphasized softening property pricing conditions in certain markets, characterizing the pace of declines as “dumb.” In response to questions about why competition is intensifying, he pointed to supply-demand dynamics and the structure of capital entering the market.
“It’s always supply-demand,” Greenberg said, adding that capital is “chasing a relatively finite amount of business,” especially in concentrated markets such as E&S and London. He said a key difference in the current cycle is how capital is “showing up” through “a volume-based incentive system,” citing MGAs, reinsurance and alternative capital, and said increased intermediation takes “bites of the apple” through the supply chain. “The loser at the end of the day is the ultimate risk-taker who puts up the capital,” he said, calling property a short-tail business where “the report card comes home rather quickly.”
Asked about terms and conditions, Greenberg said changes were only “on the margin” so far. He added that Chubb values shifts in policy terms when evaluating pricing, citing items such as business interruption waiting periods, deductibles and CPI-related adjustments.
On reinsurance, Greenberg said that when pricing becomes “marginal or inadequate,” the company manages exposure and appetite for exposure and that reinsurance is “simply one of those” tools, while emphasizing that the company focuses on risk and exposure rather than premium volume.
Life insurance and Worksite Benefits growth
Greenberg said international life premiums rose 37% and North American Chubb Worksite Benefits premiums increased almost 16%. He reported the life division produced $316 million of pre-tax income, up 8.5%, and said that after adjusting for one-time items that benefited the prior-year quarter, life income increased 11.5%.
During Q&A, Greenberg addressed the quarterly increase in savings-oriented single-premium products in Asia, saying first quarter tends to be a “very fast start” in the region. He said he did not expect the same level of growth in single-premium business to continue, and that he expected more growth in regular premium and risk-based products over the remainder of the year.
On Worksite Benefits, Greenberg said there was “no M&A…on the horizon,” describing the business as part of Chubb’s accident and health strategy and emphasizing organic growth. He said it is pursued through two distribution approaches: a retooled legacy agency force from Combined focused on small group worksite benefits, and a distribution model serving larger accounts through brokers that also represent Chubb’s P&C business. “The notion that you couldn’t cross-sell one to the other is an old myth,” he said, describing Worksite Benefits as a risk-based product mix, including some term life, written on life paper.
AI, cyber risk and digital transformation
Executives also discussed artificial intelligence as both a growth enabler and a risk consideration. Greenberg said Chubb sees significant growth opportunity in transforming small commercial retail and E&S businesses using AI, including “agentics” and evolving large language model capabilities. He added that the opportunity is not limited to North America and could be larger internationally.
In a discussion of cyber risk, Greenberg responded to a question about vulnerability-finding tools, saying they effectively lower the threshold for what constitutes a vulnerability by enabling aggregation and analysis of issues in more “insightful” ways. He described an “arms race” between offense and defense, emphasizing the importance of hygiene, monitoring services and patching, and noted that as far as Chubb can tell, most AI-enabled cyberattacks still involve humans “in the cockpit.” Greenberg also outlined how hygiene and perimeter strength can differ by company size, suggesting large accounts generally have stronger defenses while middle market companies can be attractive targets with weaker defenses.
On Chubb’s digital transformation, Greenberg said his goals had not changed in recent months and that the company is “executing” and “on track,” while noting technology is evolving rapidly and that leaders must have firsthand knowledge to avoid becoming “irrelevant.”
Private credit and alternative investments
Vice Chairman Timothy Boroughs addressed private credit, saying Chubb’s exposure is less than 4% of total investments, with just over half of that in direct lending comprised of first-lien, senior secured loans. He said the company uses separately managed accounts rather than BDCs, allowing control over deployment and conservative guidelines. Boroughs said Chubb has “remained disciplined” and “have not grown our allocation,” adding that the company’s managers have delivered a loss experience estimated at “only one-third of the broader direct lending universe.”
He also said exposure to software within direct lending is “very modest,” at less than $150 million, or 4% of the direct lending portfolio, compared with an estimated 20% sector average.
Middle East conflict and a marine insurance program
Greenberg opened the call with remarks on geopolitical uncertainty, saying war in the Middle East could contribute to higher inflation and potentially slower economic growth, though “the degree, the timing and the pattern are all unknowable.” He said the impact would not be “zero,” adding that a longer conflict could make inflation effects “stickier.”
Later, Greenberg said the U.S. government approached him to help assemble a program intended to support shipping through the Gulf under conditions where military convoys could operate. He said the purchase of the insurance program would be a condition for participation in a U.S.-run military convoy, with U.S. insurers taking 50% of the risk and the federal government taking the other half. The convoy program “has yet to occur,” he said, but he added the program is in place and could generate premium revenue if conditions warrant.
Looking ahead, Greenberg said Chubb’s diversification and discipline provide resilience in uncertain environments and reiterated confidence in continued growth in operating earnings, double-digit growth in earnings per share and tangible book value growth, excluding catastrophe impacts.
About Chubb NYSE: CB
Chubb is a global property and casualty insurance company that underwrites a broad range of commercial and personal insurance products and related services. Its offerings include commercial property and casualty coverage, specialty liability, professional and management liability, cyber and technology insurance, marine and energy, surety, accident and health solutions, and high-net-worth personal lines such as homeowners, auto and valuables protection. Chubb serves businesses, individuals and institutions with tailored underwriting and risk-transfer solutions across multiple industry sectors.
In addition to core underwriting, Chubb provides risk engineering, loss control, claims management and risk consulting services intended to reduce loss severity and help clients manage exposures.
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