Global insurer Chubb Limited has reported improved year-on-year net premiums written (NPW), a strong underwriting result, and record net income of $3.3 billion for the fourth quarter of 2023.
Alongside the 151.7% year-on-year rise in net income, Chubb’s core operating income jumped 103.6% to end Q4 2023 at a record $3.41 billion.
Consolidated NPW grew 13.4% to $11.6 billion, as global P&C (excludes Agriculture) NPW rose 10.5%, with North America up 6.2% and Overseas General up 19.3%, with growth of 37.2% in Asia and 15.4% for both Europe and Latin America.
P&C NPW hit more than $10 billion in Q4 2023, up 12.5% on the prior year quarter.
P&C underwriting income was a record $1.52 billion for the quarter, up 35.2% year-on-year, with a combined ratio of 85.5%. The current accident year underwriting income excluding catastrophe losses was $1.64 billion, up 21.1%, with a combined ratio of 84.3%.
Within the firm’s Life Insurance segment, NPW were $1.45 billion with an increase of 20.3%, and segment income was $263 million, up 43.5% year-on-year.
For the quarter, pre-tax net investment income was a record $1.37 billion, up 30.2% on Q4 2022, as adjusted net investment income hit $1.49 billion, up 33%, and another record.
The insurer has reported full year 2023 net income and core operating income of $9.03 billion and $9.34 billion, respectively, up 72.1% and 45.2%.
Consolidated NPW rose by 13.5% year-on-year, with commercial insurance up 8.6% and consumer insurance up 24.2%.
Global P&C NPW were up 10%, with commercial insurance up 8.5% and consumer insurance up 13.8%. North America was up 8.2% and Overseas General up by 13.7%, with growth in Asia, Europe, and Latin America of 24.7%, 9.4%, and 14.8%, respectively.
P&C NPW rose 9.9% to almost $42 billion in 2023, compared with $38 billion a year earlier.
The P&C underwriting result was also strong for the year, with income of $5.46 billion, up 19.9%, leading to a P&C combined ratio of 86.5% compared with 87.6% in the prior year. The P&C current accident year underwriting income excluding catastrophe losses was $6.52 billion, up 11.1%, leading to a 83.9% combined ratio compared with 84.2% prior year. Chubb notes that all the metrics were records for the year.
Within the Life Insurance business, NPW were $5.47 billion for 2023, up 51.5%, and segment income was $1.05 billion, up 58.8% on the prior year.
For 2023, pre-tax net investment income was $4.94 billion, up 31.9%, and adjusted net investment income was $5.34 billion, up 32.8%. Again, both of these were records.
Evan G. Greenberg, Chairman and Chief Executive Officer of Chubb, commented: “We had a record fourth quarter which contributed to a blowout year – the best in our company’s history. The quarter’s results included double-digit P&C premium growth globally, record P&C underwriting income with a world-class 85.5% combined ratio, record investment income, and strong life operating income, all leading to exceptional operating earnings on both a per-share and dollar basis. Our results, both earnings and book value related, were positively impacted in a significant way by a one-time deferred tax benefit related to Bermuda’s new income tax law. Core operating income was $2.3 billion excluding the tax benefit, up 36%, or $5.54 per share, up 39%. The one-time tax benefit then added $1.1 billion or $2.76 per share.
“Our full-year performance tells a compelling story: Core operating income of $9.3 billion, or a record $8.2 billion excluding the tax benefit; P&C underwriting income of $5.5 billion with a combined ratio of 86.5%; investment income of $5.3 billion; life income over $1 billion; and consolidated net premiums written growth of 13.5%. Shareholder returns for the year were excellent. Core operating ROE was 15.4% and our return on tangible equity was 24.2%. For the year, per-share book and tangible book value each grew by over 20%.
“In the quarter, P&C premiums were up 12.5% and life insurance premiums were up 20%. Of the 12.5% P&C growth, consumer lines were up 20% while commercial P&C was up 10%, which was, in fact, stronger growth than the full-year average. Chubb is a globally diversified company, and our growth in the quarter demonstrates the broad-based nature of our operations: P&C premiums were up 9.4% in North America, 37.2% in Asia, and 15.4% for both Europe and Latin America.
“In North America, commercial P&C premiums in the quarter were up 4.4%, impacted by growth of only 1.4% in our Major Accounts division. Growth was adversely impacted by pre-planned underwriting actions we took in a segment of our large account primary and excess casualty business. These actions impact future growth in underwriting income. We fully expect North America Commercial’s growth to return to more robust levels beginning with the first quarter.
“In the quarter, continuing the trend we experienced all year, commercial P&C rates and price increases across the majority of our global portfolio were strong and exceeded loss costs, which were stable. Pricing in our P&C lines was up 12.4% in North America and 10.1% in our international retail business, while financial lines pricing globally continued to decrease led by public D&O. At year-end, our loss reserves were in an exceptionally strong position – as strong as they have ever been.
“We have a lot of momentum around the world going into the first quarter and have hit the ground running. Notwithstanding the obvious fact that we are in the risk business and CAT volatility is a reality, we are confident in our ability to continue growing operating earnings at a double-digit pace through P&C revenue growth and underwriting margins, investment income, and life income.”
