Chubb Ltd
For the period ended Mar 31, 2025. Filed Apr 28, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2025 · Filed Apr 28, 2025
Extracted filing text, with the paragraph anchors used by the comparison.
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Non-GAAP Reconciliation
In presenting our results, we included and discussed certain non-GAAP measures. These non-GAAP measures, which may be defined differently by other companies, are important for an understanding of our overall results of operations and financial condition. However, they should not be viewed as a substitute for measures determined in accordance with GAAP.
We provide financial measures, including net premiums written, net premiums earned, segment income, and underwriting income on a constant-dollar basis. We believe it is useful to evaluate the trends in our results exclusive of the effect of fluctuations in exchange rates between the U.S. dollar and the currencies in which our international business is transacted, as these exchange rates could fluctuate significantly between periods and distort the analysis of trends. The impact is determined by assuming constant foreign exchange rates between periods by translating prior period results using the same local currency exchange rates as the comparable current period.
P&C performance metrics comprise consolidated operating results (including Corporate) and exclude the operating results of the Life Insurance segment. We believe that these measures are useful and meaningful to investors as they are used by management to assess the company’s P&C operations which are the most economically similar. We exclude the Life Insurance segment because the results of this business do not always correlate with the results of our P&C operations.
P&C combined ratio is the sum of the loss and loss expense ratio, policy acquisition cost ratio and the administrative expense ratio excluding the life business and including the realized gains and losses on the crop derivatives. These derivatives were purchased to provide economic benefit, in a manner similar to reinsurance protection, in the event that a significant decline in commodity pricing impacts underwriting results. We view gains and losses on these derivatives as part of the results of our underwriting operations.
CAY P&C combined ratio excluding catastrophe losses (CATs) excludes CATs and prior period development (PPD) from the P&C combined ratio. We exclude CATs as they are not predictable as to timing and amount and PPD as these unexpected loss developments on historical reserves are not indicative of our current underwriting performance. The combined ratio numerator is adjusted to exclude CATs, PPD, and expense adjustments on PPD, and the denominator is adjusted to exclude net premiums earned adjustments on PPD and reinstatement premiums on CATs and PPD. In periods where there are adjustments on loss sensitive policies, these adjustments are excluded from PPD and net premiums earned when calculating the ratios. We believe this measure provides a better evaluation of our underwriting performance and enhances the understanding of the trends in our P&C business that may be obscured by these items. This measure is commonly reported among our peer companies and allows for a better comparison.
Reinstatement premiums are additional premiums paid on certain reinsurance agreements in order to reinstate coverage that had been exhausted by loss occurrences. The reinstatement premium amount is typically a pro rata portion of the original ceded premium paid based on how much of the reinsurance limit had been exhausted.
Net premiums earned adjustments within PPD are adjustments to the initial premium earned on retrospectively rated policies based on actual claim experience that develops after the policy period ends. The premium adjustments correlate to the prior period loss development on these same policies and are fully earned in the period the adjustments are recorded.
Prior period expense adjustments typically relate to adjustable commission reserves or policyholder dividend reserves based on actual claim experience that develops after the policy period ends. The expense adjustments correlate to the prior period loss development on these same policies.
The following tables present the calculation of combined ratio, as reported for each segment to P&C combined ratio, adjusted for CATs and PPD:
| North America Commercial P&C Insurance · North America Personal P&C Insurance · North America Agricultural Insurance · Overseas General Insurance · GlobalReinsurance · Corporate · Total P&C | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| Three Months Ended | |||||||||
| March 31, 2025 | |||||||||
| (in millions of U.S. dollars except for ratios) | |||||||||
| Numerator | |||||||||
| Losses and loss expenses/policy benefits | A | $3,031 | $2,093 | $92 | $1,510 | $242 | $14 | $6,982 | |
| Catastrophe losses and related adjustments | |||||||||
| Catastrophe losses, net of related adjustments | (154) | (1,342) | (15) | (55) | (75) | — | (1,641) | ||
| Reinstatement premiums collected (expensed) on catastrophe losses | — | (50) | — | — | 13 | — | (37) | ||
| Catastrophe losses, gross of related adjustments | (154) | (1,292) | (15) | (55) | (88) | — | (1,604) | ||
| PPD and related adjustments | |||||||||
| PPD, net of related adjustments - favorable (unfavorable) | 114 | — | 33 | 121 | — | (13) | 255 | ||
| Net premiums earned adjustments on PPD - unfavorable (favorable) | (1) | — | — | — | — | — | (1) | ||
| Expense adjustments - unfavorable (favorable) | (2) | — | (3) | — | (1) | — | (6) | ||
| PPD, gross of related adjustments - favorable (unfavorable) | 111 | — | 30 | 121 | (1) | (13) | 248 | ||
| CAY loss and loss expense ex CATs | B | $2,988 | $801 | $107 | $1,576 | $153 | $1 | $5,626 | |
| Policy acquisition costs and administrative expenses | |||||||||
| Policy acquisition costs and administrative expenses | C | $1,063 | $417 | $19 | $1,167 | $110 | $105 | $2,881 | |
| Expense adjustments - favorable (unfavorable) | 2 | — | 3 | — | 1 | — | 6 | ||
| Policy acquisition costs and administrative expenses, adjusted | D | $1,065 | $417 | $22 | $1,167 | $111 | $105 | $2,887 | |
| Denominator | |||||||||
| Net premiums earned | E | $4,988 | $1,574 | $165 | $3,209 | $368 | $10,304 | ||
| Reinstatement premiums (collected) expensed on catastrophe losses | — | 50 | — | — | (13) | 37 | |||
| Net premiums earned adjustments on PPD - unfavorable (favorable) | (1) | — | — | — | — | (1) | |||
| Net premiums earned excluding adjustments | F | $4,987 | $1,624 | $165 | $3,209 | $355 | $10,340 | ||
| P&C Combined ratio | |||||||||
| Loss and loss expense ratio | A/E | 60.8% | 133.0% | 55.9% | 47.0% | 65.8% | 67.8% | ||
| Policy acquisition cost and administrative expense ratio | C/E | 21.3% | 26.5% | 11.6% | 36.4% | 29.8% | 27.9% | ||
| P&C Combined ratio | 82.1% | 159.5% | 67.5% | 83.4% | 95.6% | 95.7% | |||
| CAY P&C Combined ratio ex CATs | |||||||||
| Loss and loss expense ratio, adjusted | B/F | 59.9% | 49.3% | 65.8% | 49.1% | 43.2% | 54.4% | ||
| Policy acquisition cost and administrative expense ratio, adjusted | D/F | 21.4% | 25.7% | 13.1% | 36.4% | 31.1% | 27.9% | ||
| CAY P&C Combined ratio ex CATs | 81.3% | 75.0% | 78.9% | 85.5% | 74.3% | 82.3% | |||
| Combined ratio | |||||||||
| Combined ratio | 95.7% | ||||||||
| Add: impact of gains and losses on crop derivatives | — | ||||||||
| P&C Combined ratio | 95.7% | ||||||||
| Note: The ratios above are calculated using whole U.S. dollars. Accordingly, calculations using rounded amounts may differ. Letters A, B, C, D, E, and F included in the table are references for calculating the ratios above. | |||||||||
| North America Commercial P&C Insurance · North America Personal P&C Insurance · North America Agricultural Insurance · Overseas General Insurance · Global Reinsurance · Corporate · Total P&C | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| Three Months Ended | |||||||||
| March 31, 2024 | |||||||||
| (in millions of U.S. dollars except for ratios) | |||||||||
| Numerator | |||||||||
| Losses and loss expenses/policy benefits | A | $3,175 | $899 | $49 | $1,526 | $137 | $10 | $5,796 | |
| Catastrophe losses and related adjustments | |||||||||
| Catastrophe losses, net of related adjustments | (236) | (170) | (3) | (26) | — | — | (435) | ||
| Reinstatement premiums collected (expensed) on catastrophe losses | — | — | — | — | — | — | — | ||
| Catastrophe losses, gross of related adjustments | (236) | (170) | (3) | (26) | — | — | (435) | ||
| PPD and related adjustments | |||||||||
| PPD, net of related adjustments - favorable (unfavorable) | 48 | 52 | 28 | 89 | (1) | (9) | 207 | ||
| Net premiums earned adjustments on PPD - unfavorable (favorable) | — | — | 39 | — | — | — | 39 | ||
| Expense adjustments - unfavorable (favorable) | 8 | — | 3 | — | — | — | 11 | ||
| PPD, gross of related adjustments - favorable (unfavorable) | 56 | 52 | 70 | 89 | (1) | (9) | 257 | ||
| CAY loss and loss expense ex CATs | B | $2,995 | $781 | $116 | $1,589 | $136 | $1 | $5,618 | |
| Policy acquisition costs and administrative expenses | |||||||||
| Policy acquisition costs and administrative expenses | C | $1,016 | $386 | $23 | $1,154 | $90 | $107 | $2,776 | |
| Expense adjustments - favorable (unfavorable) | (8) | — | (3) | — | — | — | (11) | ||
| Policy acquisition costs and administrative expenses, adjusted | D | $1,008 | $386 | $20 | $1,154 | $90 | $107 | $2,765 | |
| Denominator | |||||||||
| Net premiums earned | E | $4,880 | $1,471 | $128 | $3,198 | $295 | $9,972 | ||
| Net premiums earned adjustments on PPD - unfavorable (favorable) | — | — | 39 | — | — | 39 | |||
| Net premiums earned excluding adjustments | F | $4,880 | $1,471 | $167 | $3,198 | $295 | $10,011 | ||
| P&C Combined ratio | |||||||||
| Loss and loss expense ratio | A/E | 65.1% | 61.1% | 38.6% | 47.7% | 46.3% | 58.1% | ||
| Policy acquisition cost and administrative expense ratio | C/E | 20.8% | 26.3% | 18.0% | 36.1% | 30.6% | 27.9% | ||
| P&C Combined ratio | 85.9% | 87.4% | 56.6% | 83.8% | 76.9% | 86.0% | |||
| CAY P&C Combined ratio ex CATs | |||||||||
| Loss and loss expense ratio, adjusted | B/F | 61.4% | 53.1% | 69.5% | 49.7% | 46.0% | 56.1% | ||
| Policy acquisition cost and administrative expense ratio, adjusted | D/F | 20.6% | 26.2% | 12.1% | 36.1% | 30.5% | 27.6% | ||
| CAY P&C Combined ratio ex CATs | 82.0% | 79.3% | 81.6% | 85.8% | 76.5% | 83.7% | |||
| Combined ratio | |||||||||
| Combined ratio | 86.0% | ||||||||
| Add: impact of gains and losses on crop derivatives | — | ||||||||
| P&C Combined ratio | 86.0% | ||||||||
| Note: The ratios above are calculated using whole U.S. dollars. Accordingly, calculations using rounded amounts may differ. Letters A, B, C, D, E, and F included in the table are references for calculating the ratios above. | |||||||||
The text of this filing, as the company filed it with the SEC, without its images or exhibits. This is not investment advice.