Chubb's Operating Earnings Soar
July 26 2016 - 6:00PM
Dow Jones News
Chubb Ltd. said its second-quarter operating earnings surged on
growth in premiums and net investment income, despite elevated
losses for such natural disasters as the Fort McMurray wildfires in
Canada.
Operating earnings are a widely watched benchmark for the
insurance industry because they exclude realized capital gains and
losses from companies' investment portfolios, among other items
that aren't considered recurring on a quarterly basis.
Chubb, formed earlier this year when ACE Ltd. closed on a nearly
$30 billion acquisition of Chubb, said its pretax catastrophe
losses reached $390 million in the latest quarter, compared with
$124 million a year earlier.
Higher catastrophe claims costs are expected to hurt earnings
across the industry.
Other insurers with exposure to the Fort McMurray wildfires
include global insurance conglomerate American International Group
Inc., which reports Aug. 2, and Allstate Corp., which reports on
Aug. 4, according to analysts.
Zurich-based Chubb reported operating earnings of $1.06 billion,
or $2.25 a share, up from $788 million, or $2.40 a share, a year
earlier.
Net premiums written increased 60% to $7.64 billion and net
investment income rose 26% to $708 million.
Analysts polled by Thomson Reuters expected per-share operating
profit of $2.22 and net premiums written of $7.37 billion.
Over all, Chubb reported a profit of $726 million, or $1.54 a
share, down from $942 million, or $2.86 a share, a year
earlier.
Also Tuesday, Axis Capital Holdings Ltd. said its second-quarter
operating earnings fell 50% on catastrophe losses related to
natural disasters and weather events including the Fort Murray
wildfires. Travelers Cos. on Thursday had reported that its
second-quarter operating earnings fell 19%, also depressed by
claims from catastrophes including the wildfires in Canada.
Write to Tess Stynes at tess.stynes@wsj.com
(END) Dow Jones Newswires
July 26, 2016 17:45 ET (21:45 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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