Chubb released extremely positive Q2 results on July 27, driven in particular by strong gains in its commercial property/casualty business and related rate hikes in the sector. The company used words and phrases like “record quarter” and “robust” to describe the numbers.
Net income for the quarter reached $2.27 billion, or $5.06 per share, versus a $331 million net loss or negative $0.73 per share a year ago as the coronavirus pandemic was taking hold globally. What’s more, P/C net premiums written were also up 15.5 percent around the world.
Evan Greenberg, Chubb’s chairman and CEO, was almost effusive about the insurer’s performance.
“Chubb had simply an outstanding quarter, highlighted by record core operating earnings and underwriting results,” Greenberg said in prepared remarks. “Our company is firing on all cylinders – we are growing our business while we continue to expand underwriting margins. We will continue to outperform and deliver strong, sustainable shareholder value.”
While P/C net premiums written rose 15.5 percent globally overall during the 2021 second quarter, they’re up 12.6 percent overall for the first six months of the year. Commercial lines net premiums written grew nearly 21 percent during Q2, excluding Agriculture, which saw an 11 percent gain. P/C consumer lines produced a jump of 5.6 percent in net premiums written.
Chubb’s P/C combined ratio was 85.5 during Q2, compared with 112.3 in the 2020 second quarter. Pre-tax and after-tax catastrophe losses, net of reinsurance and including reinstatement premiums, reached $280 million, respectively, for the second quarter. That compares to $1.8 billion and $1.5 billion, respectively, over the same period last year.
The insurer can also crow about investment income. Adjusted net investment income hit $945 million, rising 9.4 percent from the year ago, a result that Chubb said is a record.
Commercial insurance gains may have been the most noteworthy. Greenberg noted in his prepared remarks that the company has had double-digit commercial P/C growth on average over the past 10 years. He also noted that both the second quarter and year-to-date growth were the strongest since 2004.
Chubb grew its commercial P/C premiums in North America by more than 16 percent, while premiums in its international operations jumped 33 percent on a published basis, or 24 percent in constant dollars. Greenberg noted that net premiums written in the company’s consumer lines continue to be impacted by the pandemic’s effects on travel and other business/consumer-related activity, but he pointed to the sector’s 5.6 percent premium increase as a sign of improvement.
“We are capitalizing on a strong commercial P/C pricing environment in most all-important regions of the world,” Greenberg said.
Here are additional 2021 second quarter highlights:
- P/C Net premiums written surpassed $8.9 billion during the quarter, compared to $7.7 billion in the 2020 second quarter. Broken down, commercial P/C net premiums written were nearly $6.4 billion, versus $5.3 billion last year. Consumer P/C net premiums written were above $2.5 billion, up from nearly $2.4 billion in the same period last year.
- North America Commercial P/C insurance saw its biggest premium gains with middle market and small commercial clients.
- Overseas General Insurance net premiums written grew to nearly $2.5 billion, up from $2 billion in the 2020 second quarter.
- Chubb returned $2.27 billion to shareholders in the second quarter, including $192 billion of share repurchases at an average price of $169.19 per share and dividends of $352 million.