Chubb Ltd. Q1 FY2025 earnings call

Management Statement and Operational Highlights

• External Environment: Uncertainty in trade, rising recession odds, higher inflation; Chubb had a good first quarter despite California wildfire losses.
• Financial Performance: Core operating income $1.5 billion (down 31%); total company premiums grew 5.7% in constant dollars; combined ratio 95.7%, underwriting income $441 million; adjusted net investment income $1.7 billion (up 12.7%).
• Acquisitions: Agreed to acquire Liberty Mutual's business in Thailand and Vietnam; closed Thailand in April 2025, expecting to close Vietnam by early 2026.
• Pricing and Rate Environment: P&C revenue grew, commercial up 4.6%, consumer up 6%; commercial P&C underwriting competitive in large account, but middle-market and small commercial property rates rising; casualty firm in all areas; financial lines soft.

Segment Performance

• North America: P&C revenue grew 3.2% in the quarter (5% in constant dollars), with commercial up 4.6% and consumer up 6%. Adjusting for one-time items, North America was up 6.4%, including 10.1% growth in personal insurance and 5.3% in commercial. Commercial P&C lines were up 6.4%, financial lines down 1.3%. Very large middle-market division premiums increased almost 8%, P&C up over 10%, financial lines down about 2%.
• International General Insurance: Premiums up 1.8% (6.5% in constant dollar). Commercial lines grew about 7.5%, consumer up 5%. Asia and Latin America grew 6.1%, Europe 5.5%, London wholesale up nearly 8%. P&C pricing up 2.6%, financial lines pricing down 5.5%.
• Life Insurance: Premiums and deposits up 15.5% in constant dollar. Life division produced over $290 million of pre-tax income, up 15.7% in constant dollar.
• Reinsurance: Global reinsurance business had premium growth of 14%.

Guidance

• Management expects to continue growing operating and earnings at a double-digit rate, FX notwithstanding.
• Second quarter adjusted net investment income expected at midpoint of previously guided six-month guidance.

Risks

• Uncertainty in government trade policy impacting business and consumer confidence.
• Potential impact of tariffs on short-tail lines of business.
• Volatility in financial markets and economic conditions.

Question and Answer

Q: Gregory Peters asks about growth strategy and technology A: Evan Greenberg discusses company strategy, noting middle-market and small business globally as growth opportunities, and mentions technology spend (~$1.1-$1.2 billion, ~50% maintenance, balance for development) Q: Michael Zaremski asks about CAT losses and reserve releases A: Evan Greenberg talks about CAT volatility, saying they update peril views based on data, and comments on reserve development being a smaller quarter with mixed long-tail results Q: Brian Meredith asks about global property CAT reinsurance and capital allocation in contentious areas A: Evan Greenberg states global property CAT reinsurance renewal similar to 10-K, and capital allocation is steady, with steady approach in contentious regions like China Q: David Motemaden asks about property market competition and overseas growth A: Evan Greenberg explains structural differences between large account (brokerage driven, capacity play) and middle-market (broadly distributed, local capability), and discusses overseas growth in Asia, Europe, etc.

Q: Meyer Shields asks about loss trends and agriculture impact A: Evan Greenberg talks about loss trend adjustments, noting casualty up modestly, physical side down, and comments on agriculture hedging given tariff uncertainty Q: Alex Scott asks about casualty rate adequacy and reinsurance market A: Evan Greenberg comments on casualty rates being firm and reinsurance renewal as per 10-K Q: Robert Cox asks about tariffs impact on loss trends and E&S market growth A: Evan Greenberg discusses tariff uncertainty and its impact on pricing, and states Chubb is growing in E&S market