10-QPeriod: Q1 FY2023

Chubb Ltd Quarterly Report for Q1 Ended Mar 31, 2023

Filed May 2, 2023For Securities:CB

Summary

Chubb Ltd. reported solid financial results for the first quarter of 2023, with total revenues of $11.1 billion, a 14.8% increase year-over-year. Net income was $1.9 billion, a slight decrease of 3.2% from the prior year, impacted by market risk benefit losses and Cigna integration expenses, though partially offset by record net investment income and growth from the acquired Cigna Asia business. Net premiums written surged by 16.6% to $10.7 billion, driven by strong performance across most lines of business, particularly in commercial P&C and the life insurance segments, bolstered by the Cigna acquisition. The company's P&C combined ratio improved slightly to 86.3% from 84.3% in the prior year, with the current accident year combined ratio remaining stable, indicating continued underwriting discipline despite increased catastrophe losses and lower favorable prior period development. Shareholders' equity saw a significant increase of $2.5 billion during the quarter, reflecting strong net income and substantial unrealized gains on investments due to falling interest rates. Chubb demonstrated a commitment to returning capital to shareholders, with $772 million returned through share repurchases and dividends.

Financial Highlights

37 data points
Beta

Revenue

$11.06B

Net Income

$1.89B

17.1% Net Margin

EPS (Diluted)

$4.53

Total Assets

$201.41B

Cash & Equivalents

$2.29B

Free Cash Flow

$2.25B

Financial Statements
Beta
Revenue$11.06B
Interest Expense$160.00M
Net Income$1.89B
EPS (Basic)$4.57
EPS (Diluted)$4.53
Shares Outstanding (Basic)414.29M
Shares Outstanding (Diluted)417.93M

Key Highlights

  • 1Total revenues increased by 14.8% to $11.1 billion.
  • 2Net premiums written grew by 16.6% to $10.7 billion, with the Cigna acquisition contributing significantly.
  • 3Net income was $1.9 billion, a slight decrease of 3.2% year-over-year, impacted by market risk benefit losses.
  • 4Net investment income reached a record $1.1 billion, up 34.7% due to higher reinvestment rates.
  • 5The P&C combined ratio was 86.3%, an improvement from 84.3% in the prior year, despite higher catastrophe losses.
  • 6Shareholders' equity increased by $2.5 billion, driven by net income and unrealized investment gains.
  • 7Total capital returned to shareholders was $772 million through dividends and share repurchases.

Frequently Asked Questions

The primary driver of the 16.6% increase in net premiums written to $10.7 billion was strong growth across most lines of business, significantly boosted by the inclusion of Cigna's business in Asia acquired in the third quarter of 2022. Commercial P&C lines and the Life Insurance segment showed particularly strong performance.

Catastrophe losses increased to $458 million in Q1 2023 from $333 million in Q1 2022, and favorable prior period development decreased to $196 million from $240 million. These factors, combined with increased catastrophe losses, led to a higher P&C combined ratio of 86.3% compared to 84.3% in the prior year. However, the current accident year combined ratio excluding catastrophe losses remained stable, indicating solid underlying underwriting performance.

Net investment income reached a record $1.1 billion, a 34.7% increase year-over-year. This was primarily due to higher reinvestment rates on fixed maturities. This strong performance in investment income helped to offset some of the pressures on net income from underwriting and market risk benefits.

Chubb demonstrated a strong commitment to capital management and shareholder returns. Shareholders' equity increased by $2.5 billion during the quarter, driven by net income and significant unrealized gains on investments. The company returned $772 million to shareholders through dividends of $344 million and share repurchases of $428 million.