Summary
Chubb Ltd (CB), operating as Ace Limited at the time of this filing, reported solid financial performance for the second quarter of 2012. Net income for the quarter was $328 million, a decrease from $594 million in the prior year period, primarily due to significant net realized losses on derivative accounting related to variable annuity reinsurance. Despite this, the company's core insurance operations demonstrated strength. Net premiums written increased by 4.5%, or 6.5% on a constant-dollar basis, reflecting growth across its North American and Overseas General segments. The P&C combined ratio improved to 88.7% from 92.7% year-over-year, driven by a lower loss and loss expense ratio and a stable policy acquisition cost ratio. The company also highlighted a decrease in catastrophe losses compared to the prior year. Financially, Ace Limited maintained a strong balance sheet with total assets of $90.7 billion and shareholders' equity of $25.8 billion at the end of the quarter. The company's investment portfolio, primarily focused on investment-grade fixed income securities, provided steady net investment income of $537 million, though slightly down from the prior year due to lower yields and foreign exchange impacts. Management remains focused on prudent underwriting and risk management, as evidenced by the favorable prior period development and the continued strength in its underwriting segments, excluding the impact of the derivative accounting adjustments.
Financial Highlights
34 data points| Revenue | $3.93B |
| Interest Expense | $62.00M |
| Net Income | $328.00M |
| EPS (Basic) | $0.96 |
| EPS (Diluted) | $0.96 |
| Shares Outstanding (Basic) | 339.77M |
| Shares Outstanding (Diluted) | 342.67M |
Key Highlights
- 1Net income for the quarter was $328 million, down from $594 million in Q2 2011, largely due to $397 million in net realized losses from derivative accounting related to variable annuity reinsurance.
- 2Total net premiums written increased by 4.5% to $4.13 billion, driven by growth in the North American and Overseas General insurance segments.
- 3The P&C combined ratio improved to 88.7% from 92.7% in the prior year quarter, indicating stronger underwriting profitability.
- 4Loss and loss expense ratio improved to 59.5% from 63.1% due to reduced catastrophe losses and favorable prior period development.
- 5Net investment income was $537 million, a slight decrease from $569 million in Q2 2011, impacted by lower yields and foreign exchange.
- 6The company's financial position remained robust with total assets of $90.7 billion and shareholders' equity of $25.8 billion as of June 30, 2012.
- 7A $303 million share repurchase authorization was in place, with $461 million remaining as of June 30, 2012.