The world’s largest publicly traded property/casualty insurance company, Chubb Limited, reported net income for the quarter ended Sept. 30, 2016 of $1.36 billion, or $2.88 per share, compared with $528 million, or $1.62 per share, for the same quarter last year.
Operating income was $1.35 billion, or $2.88 per share, compared with $897 million, or $2.74 per share, for the same quarter last year.
The property/casualty combined ratio for the quarter was 86.0.
For the nine months ended Sept. 30, 2016, net income was $2.52 billion compared with $2.15 billion for 2015. The P/C combined ratio for the nine months ended Sept. 30, 2016 was 89.0.
The results are for the “new” Chubb, formed after the closing of the $29.7 billion acquisition by ACE Limited of Chubb Corp. in January.
Evan G. Greenberg, chairman and chief executive officer of Chubb Limited, termed the third quarter as an “excellent” quarter with “exceptionally strong” underwriting results and a “world class” combined ratio of 86.0.
“Previously contemplated merger-related underwriting actions that we took on select portfolios of business, particularly a greater use of reinsurance, reduced P&C net premium growth in the quarter by about 4.5 points while improving our risk-reward profile,” he said. “A competitive insurance market and relatively weak economic conditions globally impacted premium revenue in the quarter as new business meeting our standards was harder to come by. We will trade revenue for underwriting discipline all day long. We believe growth will improve as the impact from the underwriting actions dissipates and the power and capabilities of the new Chubb gain more steam. We are already seeing evidence of the effect our enhanced capabilities is having on revenue generation.”
He said the company is in “good shape” with its integration-related efficiency efforts and is now increasing the total annualized run-rate savings it expects to achieve by the end of 2018 to $800 million, up from $750 million.
The P/C expense ratio or the quarter was 29.0, compared with 27.1 last year.
Total pre-tax and after-tax catastrophe losses were $144 million (2.0 percentage points of the combined ratio) and $107 million, respectively, compared with $72 million (1.7 percentage points of the combined ratio) and $59 million, respectively, last year, the company reported.
In comments on a call with analysts reported by Carrier Management, Greenberg said Chubb has upgraded its claims technology and is starting to do the same with its underwriting. Also he said the insurer will announce digital enhancements for its high-net worth customers within months.