The paragraph is an introduction to Chubb Limited's Third Quarter 2024 Earnings Conference Call. The operator thanks participants, explains the call structure, and hands over to Karen Beyer, Senior Vice President of Investor Relations. Karen outlines that the report will include forward-looking statements subject to risks and uncertainties and refers to non-GAAP financial measures. She introduces the speakers: Evan Greenberg, Chairman and CEO, and Peter Enns, CFO, with additional management team members available for questions. Evan Greenberg then begins by announcing strong double-digit growth in P&C underwriting and investment income, leading to a core operating EPS growth of over 15.5%.

The paragraph discusses the strong financial performance of a global insurance company. It highlights a 7.6% growth in global P&C premium revenue, with an 8.5% increase in constant dollars, reflecting the company's diverse operations. Core operating income rose by 14.3% to $2.3 billion, and both net and operating income reached record levels with increases of 16.9% and 13.8%, respectively. The growth is attributed to strong results in P&C underwriting, investment income, and life income. Despite natural catastrophes, the P&C underwriting income was $1.5 billion, and the combined ratio was 87.7%. The company also reported record underwriting income on both published and current accident year bases. Their asset management continues to perform well with invested assets at $151 billion and a fixed-income portfolio yield of 4.9%. The adjusted net investment income for the quarter was up 15.9% to $1.6 billion, with a current new money rate averaging 5.5%. The company predicts a cautious approach by the Fed in reducing interest rates, considering the U.S. economy's health and inflation trends.

The paragraph discusses the company's financial performance and market conditions. The company expects a steepening yield curve to benefit its reinvestment strategy and reports strong life insurance segment income, on track to surpass their annual target. Their annualized core operating return on equity is 13.9%, and return on tangible equity is 21.7%. Global property and casualty (P&C) net premiums, excluding agriculture, increased by 7.6%, with substantial growth across regions and customer segments. Life premiums rose by 10.6%, driven by international and North American growth. The commercial P&C rate environment shows consistent trends with property becoming more competitive and casualty firms gaining rate increases. Overall, property and casualty pricing remains favorable with terms and conditions stable.

In the latest quarter, Chubb saw an increase in casualty rates and pricing compared to the previous quarter, with notable growth in its North American operations. Excluding agriculture, premiums rose by 7.8%, driven by a 10% increase in personal insurance and 7.2% in commercial lines, although financial lines saw a decline. The company wrote over $1.2 billion in new business, with a high renewal retention rate of 89.6%. Major accounts and specialty divisions experienced a 7.2% premium increase, and middle market division premiums grew nearly 7%. The underwriting environment remains favorable, with property and casualty pricing up 9.9% and workers comp pricing up 4.2%. Financial lines pricing declined, while agriculture saw increased market share. Overall, Chubb's operating performance remains strong amid a disciplined market.

The article highlights the financial performance of an insurance company, noting a decline in premiums compared to the previous year due to lower commodity prices. However, crop underwriting results were strong, and the outlook for the upcoming year is positive. In North America, the high-net-worth personal lines business experienced significant growth, with a 10% increase in premiums and strong new business growth. Homeowners pricing rose by 13.7%, staying ahead of loss trends. Internationally, the company saw a 4.9% increase in net premiums, driven by growth in the Asia Pacific, Latin America, and Europe regions, with notable increases in P&C lines and a decrease in financial lines. The international retail commercial portfolio achieved positive pricing adjustments, while the international wholesale business saw an 8% growth amidst increased competition in the London wholesale market.

The article discusses strong financial performance for a company, highlighting an excellent quarter for its international personal lines and global reinsurance businesses, with premiums up significantly despite challenges like a more active catastrophe loss quarter. The company experienced growth in international life insurance premiums and earnings, and overall, it achieved record earnings. Confidence is expressed in the ability to continue this growth. Financially, the company reported strong operating cash flow, record book value, and invested assets, along with recent debt issuances intended for general corporate purposes, including debt repayment.

In this quarter, the company returned $782 million to shareholders through share repurchases and dividends, contributing to a total of $2.4 billion returned over nine months. Book and tangible book value per share rose by 2.7% and 4.3% for the quarter and 7.7% and 10.6% year-to-date, driven by core operating income, despite capital returns. Core operating ROE was 13.6%, and return on tangible equity hit a record 21.5% year-to-date. The A-rated investment portfolio generated $1.64 billion in adjusted net investment income, including a $40 million boost from private equity. The quarter faced $765 million in pre-tax catastrophe losses, mostly from Hurricane Helene and other weather events, and saw favorable development in short-tail lines but unfavorable outcomes in long-tail lines, especially in general casualty. The corporate runoff portfolio had a $55 million adverse development, primarily from environmental liabilities. The paid-to-incurred ratio was 77%, and the core effective tax rate for the quarter was 17.7%, with projections for the fourth quarter and full year slightly higher. Guidance on the 2025 tax rate will be provided with the fourth quarter earnings.

The paragraph is a transcript of a Q&A session during a conference call. Bob Huang from Morgan Stanley asks Evan Greenberg about growth expectations in the North America commercial sector, particularly excluding financial alliances and workers' compensations, and whether growth should accelerate given strong pricing and margins. Evan Greenberg emphasizes that the company does not provide forward guidance but expresses confidence in Chubb's ability to grow above trend over time due to strong risk selection and market conditions. Bob Huang also inquires about international growth, interpreting that London might face more competition, and asks if growth will be driven by Asia and elsewhere. Greenberg clarifies that the London wholesale business represents a small portion of their international business, specifically about 10%.

The paragraph primarily discusses global retail growth, emphasizing growth in various regions: Europe at 8.5%, Latin America at 7.5%, and Asia in the nines. It highlights the significant business in U.K. retail and the London wholesale market. The paragraph also touches on classic market behaviors in London and questions about linking these observations to election outcomes. Additionally, it discusses the impact of hurricanes and catastrophic losses on property insurance lines in North America. Pricing remains firm, with further increases expected, influenced by both modeled and non-modeled losses, especially in the middle market and small commercial sectors. There's also mention of pricing pressure and competition on large accounts and E&S (Excess & Surplus) lines.

The paragraph discusses financial dynamics in the North American casualty insurance market. It mentions declining rates due to increased market competition, highlighting unusual behavior in London. Peter Enns reports a $59 million adverse development in general casualty from accident years 2019 to 2022, with mixed results in different classes, and emphasizes excess casualty's negative impact. David Motemaden inquires about previously identified troubled classes in North American commercial insurance, which were being reworked following a $50 million drag noted last quarter. Evan Greenberg indicates that the reworking process will continue for another quarter or two, having started in the fourth quarter of the previous year and extending into the first quarter.

The paragraph is a discussion between Evan Greenberg and David Motemaden about the performance and strategic focus of their insurance business. Evan Greenberg explains that, although they experienced about $50 million more in the current quarter, it's not significant compared to their overall premiums, emphasizing their diverse business that writes over $20 billion in net premiums in North America. He notes that the changes are mostly in large account casualty, a small segment relative to their business. David Motemaden acknowledges this and shifts the conversation to property insurance, noting low catastrophe losses in the third quarter despite a recent shift towards property in their portfolio. He questions whether this aligns with their expectations and if they intend to continue increasing their focus on property insurance or if it should now stabilize given market conditions.

In this paragraph, Evan Greenberg discusses the unpredictability and volatility inherent in risk-related business, particularly in terms of losses. He notes that although the recent quarter's catastrophe losses were lower than expected, this variability is typical. He emphasizes Chubb's strong capital flexibility and effective underwriting, which he believes contribute to the company's superior performance compared to the industry. Chubb is committed to pursuing business opportunities across property, casualty, and other lines, despite challenges in meeting their own growth and efficiency ambitions. Finally, Yaron Kinar from Jefferies poses a follow-up question about North America casualty rates exceeding loss trends.

In the paragraph, Evan Greenberg clarifies a misunderstanding by Yaron Kinar about exposure growth versus premium growth in casualty lines. Kinar was referencing a growth in exposure of 70 basis points in casualty pricing in North America, while Greenberg explains that this is not the same as premium growth. He uses an analogy of a store and a theater each selling 1% more goods or tickets to illustrate the concept of exposure growth, which affects pricing but not premium growth directly. Greenberg emphasizes that there is a competitive nature in both casualty and property lines across the board, as mentioned earlier.

In this dialogue, Peter Enns and Gregory Peters discuss the alignment of growth in income and top-line growth, noting that both are almost tracking at similar rates, around 10% for total Life and just over 9% for international income growth. Enns explains a previous anomaly in insurance business figures that, when adjusted, shows consistent growth. Peters then inquires about capital management strategies, particularly regarding dividends and share repurchases, given the strong financial results and stock price appreciation. Evan Greenberg confirms there are no changes in their approach, as they continue to balance capital returns to shareholders with investing at favorable risk-adjusted returns. The conversation then shifts to a new question from Ryan Tunis about competition in the London wholesale market.

The paragraph is a conversation between Ryan Tunis and Evan Greenberg, discussing concerns about the London wholesale market's behavior in attracting capital, which Greenberg believes could lead to familiar negative patterns seen before. Despite the market being profitable, Greenberg points out that the dynamics in London are peculiar and potentially problematic. When asked about the future growth of international life insurance, Greenberg indicates it won't take a decade to achieve significant gains in operating earnings. Alex Scott then shifts the topic to casualty pricing dynamics in the market, highlighting variations in specific product lines like excess liability.

The paragraph features a discussion between Evan Greenberg and Alex Scott about profitability and pricing in the casualty insurance market. Greenberg emphasizes that the situation varies widely across different areas, customers, and geographies, making it an "underwriter's market" where experience, data, and analytics are crucial. Scott touches on how lower paid claims relative to incurred can potentially lead to growth in asset bases and more net investment income. Greenberg acknowledges the importance of strong reserves and business growth, but doesn't concur with Scott's notion of an elongated payout pattern.

In the paragraph, Evan Greenberg discusses Chubb's strong growth in its invested asset base and highlights that the company's business growth and healthy margins have contributed to this expansion. The invested assets continue to provide a robust income source with returns that exceed the cost of capital. Greenberg emphasizes their strategic focus on growth and returns within their asset management. When Andrew Kligerman inquires about Chubb's performance in financial lines, particularly in Directors & Officers (D&O) insurance where premiums are down, Greenberg declines to provide specific figures but assures that Chubb still profits from D&O business and maintains a significant market presence. They are selective in writing business to ensure profitability.

In this paragraph, Evan Greenberg discusses the performance and competitiveness of the insurance industry, emphasizing the importance of considering cat-levered and ex-cat combined ratios when evaluating risk and financial health. He argues against solely focusing on ex-cat figures and highlights that published combined ratios are crucial indicators of industry performance. Although some companies perform well, others may not, with overall returns being decent but not extraordinary. He stresses the importance of maintaining adequate pricing and addressing relentless loss trends to sustain these returns.

In the article paragraph, Elyse Greenspan from Wells Fargo asks Evan Greenberg about the financial specifics regarding long tail reserves and investment income guidance. Greenberg confirms there were both positive and negative aspects to the long tail reserves, particularly with excess casualty, but refrains from providing detailed breakdowns. On investment income guidance, he indicates that for the fourth quarter, the company expects to be at the high end of the guidance provided in the last six months. Regarding tax rate inquiries in light of Bermuda tax changes, Greenberg avoids specifics and reiterates that the company usually gives full year guidance in the fourth quarter. The paragraph concludes with the operator introducing the next analyst’s question.

In the discussed paragraph, Evan Greenberg addresses a question regarding the impact of pricing derived from rate versus exposure units on loss ratio progress. Greenberg clarifies that exposure units refer to the number of policies or insureds and do not contribute to price directly, and the distinction doesn't affect how premiums are earned, which is evenly over the policy term. Furthermore, when asked about the implications of a slowdown in pricing on underwriting profitability, Greenberg dismisses any direct correlation, suggesting this is a complex topic dependent on various factors, and not necessarily impacting underwriting profitability. He humorously ends by inviting further discussion on the topic later.

The conversation revolves around the casualty insurance market, where recent pricing has risen to approximately 12%, surpassing many companies' loss cost assumptions. Evan Greenberg explains that the increase reflects efforts to achieve adequate risk-adjusted returns across various segments of the casualty portfolio, with some areas needing sharper price hikes to ensure price adequacy. This strategy has resulted in excellent combined ratios for the company. When asked about life insurance guidance, Greenberg declines to provide forward guidance, noting that this year was unique due to the absence of acquisition noise, thus offering a clearer view of the company's position relative to expectations.

In the paragraph, a speaker discusses their company's target of achieving or surpassing $1 billion in operating income for the full year of 2024, emphasizing that they are on track to meet this goal. Michael Zaremski acknowledges this, noting the company's strong earnings and growth potential. Karen Beyer thanks the participants for joining the conference call and offers to take follow-up questions before concluding the call.

This summary was generated with AI and may contain some inaccuracies.