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Item 2. Management’s Discussion and Analysis

2023-05-02 compared with 2022-10-28 · 327 added, 499 removed, 777 unchanged (52% of the section changed)

Management's Discussion and Analysis of Financial Condition and Results of Operations

The following is a discussion of our results of operations, financial condition, and liquidity and capital resources as of and for the three and nine months ended September 30, 2022.

The following is a discussion of our results of operations, financial condition, and liquidity and capital resources as of and for the three months ended March 31, 2023.

All comparisons in this discussion are to the corresponding prior year period unless otherwise indicated.

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Net Investment Income

Interest Expense

Critical Accounting Estimates

Unpaid Losses and Loss Expenses

Future policy benefits

Asbestos and Environmental (A&E)

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• the effects of public company bankruptcies and accounting restatements, as well as disclosures by and investigations of public companies relating to possible accounting irregularities, and other corporate governance issues;

• acquisitions made performing differently than expected, our failure to realize anticipated expense-related efficiencies or growth from acquisitions, the impact of acquisitions on our pre-existing organization, including with respect to our announced acquisitions not closing;

risks and uncertainties relating to our planned purchases of additional interests in Huatai Insurance Group Co., Ltd.

• acquisitions made performing differently than expected, our failure to realize anticipated expense-related efficiencies or growth from acquisitions, the impact of acquisitions on our pre-existing organization, and risks and uncertainties relating to our planned purchases of additional interests in Huatai Insurance Group Co., Ltd.

(Huatai Group), including our ability to receive Chinese insurance regulatory approval and complete the purchases;

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Chubb Limited, which is headquartered in Zurich, Switzerland, and its direct and indirect subsidiaries (collectively, the Chubb Group of Companies, Chubb, we, us, or our) are a global insurance and reinsurance organization, serving the needs of a diverse group of clients worldwide.

At September 30, 2022, we had total assets of $198 billion and shareholders’ equity of $48 billion.

At March 31, 2023, we had total assets of $201 billion and shareholders’ equity of $53 billion.

Chubb was incorporated in 1985 at which time it opened its first business office in Bermuda and continues to maintain operations in Bermuda.

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For more information on our segments refer to “Segment Information” under Item 1 in our 2022 Form 10-K.

On July 1, 2022, we completed the acquisition of the life and non-life insurance companies that house the personal accident, supplemental health, and life insurance business of Cigna in six Asian markets.

Our results for the three and nine months ended September 30, 2022, include the results of these acquired businesses from July 1, 2022, and are included in our Life Insurance segment and, to a lesser extent, Overseas General Insurance segment according to the nature of the business written.

Refer to Note 2 to the Consolidated Financial Statements for additional information on our acquisition.

Consolidated Operating Results – Three and Nine Months Ended September 30, 2022 and 2021

Three Months Ended Nine Months Ended

September 30 % Change September 30 % Change

Consolidated Operating Results – Three Months Ended March 31, 2023 and 2022

Three Months Ended

March 31 % Change

(in millions of U.S.

dollars, except for percentages) 2023 2022 Q-23 vs.

Q-21 2022 2021 YTD-22 vs.

Net premiums written $ 10,710 $ 9,189 16.6 %

Net premiums written - constant dollars (1)

17.3 % 12.1 %

Net premiums earned 10,142 8,737 16.1 %

Net investment income 1,107 822 34.7 %

Net realized gains (losses) (384) (21) NM (787) 833 NM

Net realized gains (losses) (77) 23 NM

Market risk benefits gains (losses) (115) 49 NM

Total revenues 11,057 9,631 14.8 %

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Interest expense 160 132 21.6 %

Other (income) expense 188 (763) NM (21) (2,030) (99.0) %

Other (income) expense (296) (312) (5.1) %

Amortization of purchased intangibles 72 71 1.9 %

Cigna integration expenses 23 — NM 26 — NM

Cigna integration expenses 22 — NM

Total expenses 8,781 7,325 19.9 %

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Amounts are calculated by translating prior period results using the same local currency exchange rates as the comparable current period.

Financial Highlights for the Three Months Ended September 30, 2022

• Net income was $812 million compared with $1.8 billion in the prior year period.

Net income in the current quarter was driven by strong underwriting results, including growth in net premiums earned and improvement in our combined ratios.

Net income is lower compared to prior year, reflecting the after-tax mark-to-market losses on private equities of $231 million, compared to gains of $705 million in the prior year.

• Consolidated net premiums written were $12.0 billion, up 14.4 percent, or 17.3 percent in constant dollars.

The acquisition of Cigna's business in Asia added 7.1 percentage points, or 7.2 percentage points in constant dollars, to the growth in net premiums written.

• Consolidated net premiums earned were $11.5 billion, up 15.3 percent, or 18.6 percent in constant dollars.

The acquisition of Cigna's business in Asia added 7.3 percentage points, or 7.5 percentage points in constant dollars, to the growth in net premiums earned.

• Total pre-tax and after-tax catastrophe losses were $1.2 billion (11.3 percentage points of the P&C combined ratio) and $949 million, respectively, compared with $1.1 billion (12.2 percentage points of the P&C combined ratio) and $943 million, respectively, in the prior year period.

Catastrophe losses in the current quarter were primarily from Hurricane Ian losses of $975 million pre-tax and global weather-related events.

• Total pre-tax and after-tax favorable prior period development were $222 million (2.2 percentage points of the P&C combined ratio) and $162 million, respectively, including pre-tax adverse development of $52 million related to legacy environmental exposures.

Excluding the adverse development, we had pre-tax favorable development of $274 million, with 5 percent in long-tail lines, and 95 percent in short-tail lines.

This compares with pre-tax and after-tax favorable prior

period development of $321 million (3.6 percentage points of the P&C combined ratio) and $227 million, respectively, in the prior year period.

Financial Highlights for the Three Months Ended March 31, 2023

• Net income was $1.9 billion compared with $2.0 billion in the prior year period.

Net income in the current quarter included the results of Cigna's business acquired during the third quarter of 2022 and record net investment income.

Net income is slightly lower compared to the prior year, reflecting market risk benefit losses of $115 million, from lower interest rates and higher volatility, partially offset by higher equity markets, compared to a gain of $49 million in the prior year.

• Consolidated net premiums written were $10.7 billion, up 16.6 percent, or 18.3 percent in constant dollars, with Cigna's business in Asia adding 8.3 percentage points, or 8.4 percentage points in constant dollars.

P&C net premiums written were up 9.3 percent, or 11.0 percent in constant dollars, with commercial and consumer lines up 11.5 percent and 9.4 percent, respectively.

• Consolidated net premiums earned were $10.1 billion, up 16.1 percent, or 17.7 percent in constant dollars, with Cigna's business in Asia adding 8.7 percentage points, or 8.8 percentage points in constant d ollars.

P&C net premiums earned increased 8.3 percent, or 9.8 percent in constant dollars, with commercial and consumer lines up 10.5 percent and 8.0 percent, respectively.

• Total pre-tax and after-tax catastrophe losses were $458 million (5.1 percentage points of the P&C combined ratio) and $382 million, respectively, compared with $333 million (4.0 percentage points of the P&C combined ratio) and $290 million, respectively, in the prior year period.

Catastrophe losses in the current quarter were primarily from global weather-related events.

• Total pre-tax and after-tax favorable prior period development were $196 million (2.2 percentage points of the combined ratio) and $149 million, respectively.

The $196 million in pre-tax development was comprised of $202 million in favorable non-catastrophe development and $6 million in adverse catastrophe-related development.

This compares with $240 million (3.2 percentage points of the combined ratio) and $195 million, respectively, in the prior year period.

• The P&C combined ratio was 86.3 percent compared with 84.3 percent in the prior year period.

The current year P&C combined ratio increased primarily due to higher catastrophe losses and lower favorable prior period development.

The P&C current accident year (CAY) combined ratio excluding catastrophe losses was 83.4 percent compared with 83.5 percent in the prior year period.

The current year ratios decreased due to the favorable impact of higher net premiums earned on the expense ratio.

• Net investment income was a record $979 million compared with $866 million in the prior year period.

• Net investment income was a record $1.1 billion compared with $822 million in the prior year period, primarily reflecting higher reinvestment rates.

• Operating cash flow was $2.25 billion compared with $2.44 billion in the prior year period.

• Shareholders' equity decreased by $4.0 billion in the quarter, as net income of $812 million was more than offset by net unrealized losses on investments of $2.9 billion after-tax from rising interest rates and $1.0 billion related to cumulative foreign exchange translation.

In addition, shareholders' equity reflected total capital returned to shareholders in the quarter of $1.0 billion, including share repurchases of $685 million, at an average purchase price of $186.22 per share, and dividends of $346 million.

• Effective January 1, 2023, we adopted the Long-Duration Targeted Improvements (LDTI) U.S.

GAAP guidance, which principally impacted the Life Insurance segment.

Financial data for the prior reporting periods in this report are adjusted, as applicable, and are presented in accordance with the new guidance.

The impact to 2022 results was immaterial.

• Shareholders' equity increased by $2.5 billion in the quarter, primarily from net income of $1.9 billion and net unrealized gains on investments of $1.6 billion after-tax from lower interest rates.

In addition, shareholders' equity reflected total capital returned to shareholders in the quarter of $772 million, including share repurchases of $428 million, at an average purchase price of $212.81 per share, and dividends of $344 million.

Net Premiums Written Three Months Ended

September 30 % Change Nine Months Ended

September 30 %

March 31 % Change

(in millions of U.S.

dollars, except for percentages) 2023 2022 Q-23 vs.

Q-21 2022 2021 YTD-22 vs.

Commercial casualty $ 1,903 $ 1,837 3.6 % 5.3 %

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Total Commercial P&C lines 6,202 5,842 6.2 % 7.8 %

Agriculture 1,723 1,415 21.8 % 21.8 % 2,523 2,110 19.6 % 19.6 %

Agriculture 293 62 NM NM

Personal automobile 427 412 3.6 % 0.9 %

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Total Personal lines 1,836 1,737 5.7 % 6.5 %

Total Property and Casualty lines 9,763 9,024 8.2 % 10.4 % 26,159 24,131 8.4 % 10.3 %

Global A&H lines (2)

1,518 922 64.7 % 75.3 % 3,451 2,855 20.9 % 26.7 %

Global A&H - P&C 809 719 12.5 % 16.3 %

Reinsurance lines 277 253 9.4 % 10.4 %

Total Property and Casualty lines 9,417 8,613 9.3 % 11.0 %

Global A&H - Life 809 256 215.3 % 218.9 %

Life 484 320 51.5 % 55.3 %

Life Insurance 1,293 576 124.4 % 128.7 %

Total consolidated $ 10,710 $ 9,189 16.6 % 18.3 %

(1) Commercial multiple peril represents retail package business (property and general liability).

(2) For purposes of this schedule only, A&H results include Combined North America and International businesses, which are normally included in the Life Insurance and Overseas General Insurance segments, respectively, as well as the A&H results of our North America Commercial P&C segment, are included in Global A&H lines above.

The increase in consolidated net premiums written for the three and nine months ended September 30, 2022, reflects growth across most lines of business driven by positive rate increases, new business, and strong renewal retention.

The acquisition of Cigna's business in Asia contributed $738 million for the three and nine months ended September 30, 2022.

• Commercial casualty grew primarily in North America, Europe, and Asia, driven by strong new business and retention, including exposure and rate increases.

• Workers' compensation decreased for the quarter due to a favorable COVID-related exposure adjustment in the prior year.

Growth for the nine months ended September 30, 2022, was due to exposure increases in North America.

• Financial lines decreased for the quarter as growth in Asia and Latin America was more than offset by lower retention and lower new business in North America.

The year-to-date increase reflects growth across most regions from strong new business and retention, and rate increases.

The increase in consolidated net premiums written for the three months ended March 31, 2023, reflects growth across most product lines driven by strong renewal retention, positive rate increases, and new business.

Cigna's business in Asia contributed $758 million for the three months ended March 31, 2023.

• Commercial casualty grew in all regions globally driven by strong premium retention, including both rate and exposure increases, and strong new business.

• Workers' compensation growth was due to strong premium retention and rate increases in North America.

• Financial lines decreased, reflecting lower new business and lower rates in North America.

• Surety increased due to strong new business in North America.

• Commercial multiple peril increased due to strong new business and renewal retention, including exposure and positive rate increases in North America.

• Property and other short-tail lines grew globally due to strong new business and renewal retention, including positive rate increases and increased exposure.

• Agriculture increased due to underlying growth in crop insurance, reflecting higher commodity prices, higher reported acreage from policyholders, and policy count growth.

Partially offsetting growth for the nine months was a return of premium to the U.S.

government in the first quarter of 2022 of $161 million.

• Personal lines grew in most regions reflecting new business and strong renewal retention, from both rate and exposure increases, primarily in homeowners and automobile in North America, high net worth and specialty lines in Asia, and specialty lines and automobile in Latin America.

Partially offsetting growth in North America were additional cancellations in parts of California exposed to wildfires.

• Global A&H lines increased due to the acquisition of Cigna's business in Asia in the third quarter of 2022, which contributed $ 593 m illion.

Additionally, growth in Asia, Latin America, Europe, and Japan on a constant dollar basis, was driven by higher new business and increased travel volume and consumer activity.

• Commercial multiple peril increased due to strong premium retention, including both rate and exposure increases, and strong new business in North America.

• Property and other short-tail lines grew globally due to strong premium retention, including both rate and exposure increases, and strong new business.

• Agriculture increased due to underlying growth in crop insurance, reflecting higher commodity prices.

In addition, the prior year included a return of premium to the U.S.

government of $161 million.

• Personal lines grew principally in North America, with growth strongest in our high net worth business.

• Global A&H – P&C increased due to growth in Asia, including $34 million from the acquisition of Cigna’s business in Asia, and higher new business and increased consumer activity, including higher travel volume, in Europe, Latin America, and Japan.

• Reinsurance lines increased primarily due to continued growth in the portfolio, driven by new business.

• Global A&H – Life increased due to the acquisition of Cigna’s business in Asia, which contributed $570 million to growth.

Our North American Combined Insurance supplemental A&H business decreased primarily due to the non-renewal of a large program.

• Reinsurance lines increased for the quarter primarily due to higher catastrophe reinstatement premiums.

Growth for the nine months ended September 30, 2022, was driven by new business and favorable premium adjustments;

partially offset by a one-time portfolio transfer in the prior year.

• International life operations increased due to the acquisition of Cigna's business in Asia in the third quarter of 2022, which contributed $145 million.

Growth from new business in Asia, primarily in Thailand, Indonesia and Vietnam, was more than offset by lower business in Latin America, principally reflecting the non-renewal of certain large account business in Chile.

• Life increased driven substantially by growth in Asia, principally from new business in Hong Kong, and the acquisition of Cigna's business in Asia, which contributed $154 million to growth.

For additional information on net premiums written, refer to the segment results discussions.

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Net premiums earned for long-duration contracts, typically traditional life contracts, generally are recognized as earned when due from policyholders.

For the three months ended September 30, 2022, net premiums earned increased $1,535 million, or 15.3 percent.

For the nine months ended September 30, 2022, net premiums earned increased $2,804 million, or 10.4 percent.

For the three months ended March 31, 2023, net premiums earned increased $1.4 billion, up 16.1 percent, or 17.7 percent in constant dollars.

P&C net premiums earned increased 8.3 percent, or 9.8 percent in constant dollars, comprising growth in commercial and consumer lines of 10.5 percent and 8.0 percent, respectively.

Catastrophe Losses and Prior Period Development

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and Canada, we generally use a similar definition.

We also define losses from certain pandemics, such as COVID-19, as a catastrophe loss.

Prior period development includes adjustments relating to either profit commission reserves or policyholder dividend reserves based on actual claim experience that develops after the policy period ends.

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Refer to the Non-GAAP Reconciliation section for further information on reinstatement premiums on catastrophe losses and adjustments to prior period development.

Three Months Ended Nine Months Ended

September 30 September 30

Three Months Ended

(in millions of U.S.

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Favorable prior period development $ 196 $ 240

Catastrophe losses through September 30, 2022 and 2021, were primarily from the following events:

Hurricane Ian losses of $975 million, severe weather-related events in the U.S.

and internationally, Australia storms, and Colorado wildfires.

Hurricane Ida losses of $806 million, winter storm losses in the U.S., flooding in Europe, and other severe weather-related events in the U.S.

Catastrophe losses through March 31, 2023 and 2022, were primarily from the following events:

Severe weather-related events in the U.S.

and internationally;

and New Zealand storms.

Australia storms, Colorado wildfires, and other severe weather-related events in the U.S.

and internationally.

Prior period development (PPD) arises from changes to loss estimates recognized in the current year that relate to loss events that occurred in previous calendar years and excludes the effect of losses from the development of earned premium from previous accident years.

Pre-tax net favorable PPD for the three months ended September 30, 2022, was $222 million, including adverse development of $52 million related to legacy environmental exposures.

Excluding the adverse development, we had favorable development of $274 million, with 5 percent in long-tail lines, principally from accident years 2018 and prior, and 95 percent in short-tail lines, primarily in property lines.

Pre-tax net favorable PPD for the nine months ended September 30, 2022, was $709 million, including adverse development of $155 million for molestation claims, predominantly reviver statute-related, and adverse development of $52 million related to legacy environmental exposures.

The molestation adverse development includes no change to the previously established reserve for the Boy Scouts of America settlement.

Excluding the adverse development, we had favorable development of $916 million with 29 percent in long-tail lines, principally from accident years 2018 and prior, and 71 percent in short-tail lines, primarily in property and A&H lines.

Pre-tax net favorable PPD for the three months ended September 30, 2021, was $321 million, including adverse development of $33 million related to legacy environmental exposures.

Excluding the adverse development, we had favorable development of $354 million with 30 percent in long-tail lines, principally from accident years 2017 and prior, and 70 percent in short-tail lines, primarily in homeowners and property lines.

Pre-tax net favorable PPD for the nine months ended September 30, 2021, was $781 million, including adverse development of $33 million related to legacy environmental exposures and $68 million for molestation claims.

Excluding the adverse development, we had favorable development of $882 million with 27 percent in long-tail lines, principally from accident years 2017 and prior, and 73 percent in short-tail lines, primarily in homeowners, A&H, property, and surety lines.

Pre-tax net favorable PPD for the three months ended March 31, 2023, was $196 million, comprising $202 million in favorable non-catastrophe development and $6 million in adverse catastrophe-related development.

This development includes adverse development of $19 million in long-tail lines, principally from accident years 2013 through 2017.

The remaining net favorable development of $215 million in short-tail lines is primarily in surety and A&H lines.

Pre-tax net favorable PPD for the three months ended March 31, 2022, was $240 million, with 5 percent in long-tail lines, principally from accident years 2018 and prior, and 95 percent in short-tail lines, primarily in A&H, property, and surety lines.

Refer to the prior period development discussion in Note 8 to the Consolidated Financial Statements for additional information.

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A P&C combined ratio under 100 percent indicates underwriting income, and a combined ratio exceeding 100 percent indicates underwriting loss.

Three Months Ended Nine Months Ended

September 30 September 30

2022 2021 2022 2021

Three Months Ended

Loss and loss expense ratio

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P&C Combined ratio 86.3 % 84.3 %

The loss and loss expense ratio and the CAY loss ratio excluding catastrophe losses increased for the three months ended September 30, 2022, reflecting the impact of a current accident year benefit recorded in the prior year partially offset by earned rate exceeding loss cost trends.

The loss and loss expense ratio and the CAY loss ratio excluding catastrophe losses decreased for the nine months ended September 30, 2022, primarily from earned rate exceeding loss cost trends.

The loss and loss expense ratio for the nine months ended September 30, 2022, also benefited from higher net premiums earned and lower catastrophe losses, partially offset by lower favorable prior period development.

The policy acquisition cost ratio decreased for the three and nine months ended September 30, 2022, primarily due to a higher percentage of net premiums earned from lines that have a lower acquisition cost ratio.

The administrative expense ratio decreased for the three and nine months ended September 30, 2022, primarily due to the favorable impact of higher net premiums earned, partially offset by higher employee-related expenses and increased investment to support growth.

The loss and loss expense ratio increased for the three months ended March 31, 2023, reflecting higher catastrophe losses and lower favorable prior period development.

The CAY loss ratio excluding catastrophe losses decreased for the three months ended March 31, 2023, primarily from a higher percentage of net premiums earned from lines with a lower loss ratio and earned rate and exposure exceeding loss cost trends in certain lines.

The policy acquisition cost ratio decreased for the three months ended March 31, 2023, primarily due to the favorable impact of higher net premiums earned.

The administrative expense ratio for the three months ended March 31, 2023 remained essentially flat as higher employee-related expenses and increased investment to support growth was offset by the favorable impact of higher net premiums earned.

Policy benefits

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Refer to the Life Insurance segment operating results section for further discussion.

For the three months ended September 30, 2022 and 2021, Policy benefits were $486 million and $151 million, respectively, which included (gains) losses from fair value changes in separate account liabilities that do not qualify for separate account reporting under GAAP of $(67) million and $(24) million, respectively.

The offsetting movements of these liabilities are recorded in Other (income) expense on the Consolidated statements of operations.

Excluding the separate account gains and losses, Policy benefits were $553 million and $175 million for the three months ended September 30, 2022 and 2021, respectively.

For the nine months ended September 30, 2022 and 2021, Policy benefits were $790 million and $503 million, respectively, which included (gains) losses from fair value changes in separate account liabilities that do not qualify for separate account reporting under GAAP of $(116) million and $(5) million, respectively.

For the three months ended March 31, 2023 and 2022, Policy benefits were $797 million and $373 million, respectively, which included (gains) losses from fair value changes in separate account liabilities that do not qualify for separate account reporting under GAAP of $(25) million and $(31) million, respectively.

The offsetting movements of these liabilities are recorded in Other (income) expense on the Consolidated statements of operations.

Excluding the separate account gains and losses, Policy benefits were $906 million and $508 million for the nine months ended September 30, 2022 and 2021, respectively.

Excluding the separate account gains and losses, Policy benefits were $822 million and $404 million for the three months ended March 31, 2023 and 2022, respectively.

Refer to the respective sections that follow for a discussion of Net investment income, Other (income) expense, Net realized gains (losses), Amortization of purchased intangibles, and Income tax expense.

Segment Operating Results – Three and Nine Months Ended September 30, 2022 and 2021

Segment Operating Results – Three Months Ended March 31, 2023 and 2022

We operate through six business segments:

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North America Commercial P&C Insurance

The North America Commercial P&C Insurance segment comprises operations that provide property and casualty (P&C) and accident & health (A&H) insurance and services to large, middle market, and small commercial businesses in the U.S., Canada, and Bermuda.

The North America Commercial P&C Insurance segment comprises operations that provide P&C insurance and services to large, middle market, and small commercial businesses in the U.S., Canada, and Bermuda.

This segment includes our North America Major Accounts and Specialty Insurance division (large corporate accounts and wholesale business), and the North America Commercial Insurance division (principally middle market and small commercial accounts).

Three Months Ended Nine Months Ended

September 30 % Change September 30 % Change

Three Months Ended

March 31 % Change

(in millions of U.S.

dollars, except for percentages) 2023 2022 Q-23 vs.

Q-21 2022 2021 YTD-22 vs.

Net premiums written $ 4,288 $ 4,039 6.2 %

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Loss and loss expense ratio:

CAY loss ratio excluding catastrophe losses 61.5 % 62.3 % (0.8) pts 61.5 % 63.1 % (1.6) pts

Catastrophe losses 14.0 % 11.9 % 2.1 pts 6.3 % 8.7 % (2.4) pts

Prior period development (4.6) % (4.5) % (0.1) pts (4.7) % (4.1) % (0.6) pts

Loss and loss expense ratio 70.9 % 69.7 % 1.2 pts 63.1 % 67.7 % (4.6) pts

Policy acquisition cost ratio 13.6 % 13.5 % 0.1 pts 13.5 % 13.5 % — pts

Administrative expense ratio 6.4 % 6.9 % (0.5) pts 6.4 % 6.7 % (0.3) pts

Combined ratio 90.9 % 90.1 % 0.8 pts 83.0 % 87.9 % (4.9) pts

Catastrophe Losses and Prior Period Development Three Months Ended Nine Months Ended

September 30 September 30

CAY loss ratio excluding catastrophe losses 60.5 % 61.5 % (1.0) pts

Catastrophe losses 3.7 % 2.0 % 1.7 pts

Prior period development (1.7) % (2.8) % 1.1 pts

Loss and loss expense ratio 62.5 % 60.7 % 1.8 pts

Policy acquisition cost ratio 14.0 % 13.9 % 0.1 pts

Administrative expense ratio 6.7 % 6.5 % 0.2 pts

Combined ratio 83.2 % 81.1 % 2.1 pts

Catastrophe Losses and Prior Period Development Three Months Ended

(in millions of U.S.

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Favorable prior period development $ 72 $ 108

Catastrophe losses through September 30, 2022 and 2021, were primarily from the following events:

Hurricane Ian losses, severe weather-related events and winter storm losses in the U.S.

Hurricane Ida losses, winter storm losses and other severe weather-related events in the U.S.

Refer to the prior period development discussion in Note 6 to the Consolidated Financial Statements for additional information.

Net premiums written increased $353 million, or 8.1 percent, and $1,108 million, or 9.0 percent, for the three and nine months ended September 30, 2022, respectively, reflecting strong premium retention, including both rate and exposure increases.

Additionally, there was new business across a number of retail and wholesale lines, including property, primary and excess casualty, commercial multiple peril, and surety.

A&H growth reflects recovery in A&H lines from exposure declines in the prior year and strong new business.

Growth for the nine months ended September 30, 2022 also reflects strong premium retention, including rate and exposure increases, from financial lines and workers’ compensation.

Net premiums earned increased $329 million, or 8.3 percent, and $1,214 million, or 10.6 percent for the three and nine months ended September 30, 2022, respectively, reflecting the growth in net premiums written described above.

Catastrophe losses through March 31, 2023 and 2022, were primarily from the following events:

flooding, hail, tornadoes, wind events, and winter storm losses.

Winter storm losses and other severe weather-related events in the U.S.

Refer to Note 8 in the Consolidated Financial Statements for detail on prior period development.

Net premiums written increased $249 million, or 6.2 percent for the three months ended March 31, 2023, reflecting strong premium retention, including both rate and exposure increases, and strong new business in certain lines.

The increase in premiums was across most lines of business, including property, commercial multiple peril, A&H, and excess casualty.

Partially offsetting the increase was a 1.3 percentage point impact of loss portfolio transfer transactions year-over-year.

Net premiums earned increased $255 million, or 6.2 percent for the three months ended March 31, 2023, reflecting the growth in net premiums written described above.

Combined Ratio

The loss and loss expense ratio increased for the three months ended September 30, 2022, primarily from higher catastrophe losses.

The loss and loss expense ratio decreased for the nine months ended September 30, 2022, primarily from lower catastrophe losses and higher favorable prior period development.

The CAY loss ratio excluding catastrophe losses decreased for the three and nine months ended September 30, 2022, primarily from earned rate exceeding loss cost trends.

The administrative expense ratio decreased for the three and nine months ended September 30, 2022, primarily due to a one-time expense accrual release and the favorable impact of higher net premiums earned, partially offset by higher employee-related expenses.

The loss and loss expense ratio increased for the three months ended March 31, 2023, primarily from higher catastrophe losses and lower favorable prior period development.

Prior period development for the three months ended March 31, 2023, comprised $112 million of favorable development, partially offset by a charge of $40 million related to development from the 2022 late-season catastrophes.

The CAY loss ratio excluding catastrophe losses decreased for the three months ended March 31, 2023, primarily from a higher percentage of net premiums earned from property lines that have a lower loss ratio and earned rate and exposure exceeding loss cost trends in certain lines.

The administrative expense ratio increased for the three months ended March 31, 2023, primarily due to higher pension expenses reflecting unfavorable market conditions, partially offset by the favorable impact of higher net premiums earned.

We expect the higher pension expense to continue through 2023.

North America Personal P&C Insurance

The North America Personal P&C Insurance segment comprises operations that provide high net worth personal lines products, including homeowners and complementary products such as valuable articles, excess liability, automobile, and recreational marine insurance and services in the U.S.

Three Months Ended Nine Months Ended

September 30 % Change September 30 % Change

Three Months Ended

March 31 % Change

(in millions of U.S.

dollars, except for percentages) 2023 2022 Q-23 vs.

Q-21 2022 2021 YTD-22 vs.

Net premiums written $ 1,296 $ 1,180 9.9 %

5 unchanged sentences

Net investment income 82 59 39.1 %

Other (income) expense 1 1 — 3 (3) NM

Other (income) expense 1 1 —

Amortization of purchased intangibles 2 2 —

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Loss and loss expense ratio:

CAY loss ratio excluding catastrophe losses 53.6 % 50.7 % 2.9 pts 53.5 % 52.5 % 1.0 pts

Catastrophe losses 20.6 % 31.9 % (11.3) pts 12.2 % 18.9 % (6.7) pts

Prior period development (10.0) % (14.6) % 4.6 pts (4.9) % (7.3) % 2.4 pts

Loss and loss expense ratio 64.2 % 68.0 % (3.8) pts 60.8 % 64.1 % (3.3) pts

Policy acquisition cost ratio 20.6 % 20.4 % 0.2 pts 20.6 % 20.4 % 0.2 pts

Administrative expense ratio 5.3 % 5.9 % (0.6) pts 5.5 % 5.5 % — pts

Combined ratio 90.1 % 94.3 % (4.2) pts 86.9 % 90.0 % (3.1) pts

NM - not meaningful

CAY loss ratio excluding catastrophe losses 53.9 % 53.3 % 0.6 pts

Catastrophe losses 12.1 % 8.0 % 4.1 pts

Prior period development 1.3 % (4.1) % 5.4 pts

Loss and loss expense ratio 67.3 % 57.2 % 10.1 pts

Policy acquisition cost ratio 20.6 % 20.8 % (0.2) pts

Administrative expense ratio 6.0 % 5.5 % 0.5 pts

Combined ratio 93.9 % 83.5 % 10.4 pts

Catastrophe Losses and Prior Period Development

Three Months Ended Nine Months Ended

September 30 September 30

Three Months Ended

(in millions of U.S.

1 unchanged sentence

Catastrophe losses $ 159 $ 100

Favorable prior period development $ 133 $ 182 $ 187 $ 266

Catastrophe losses through September 30, 2022 and 2021, were primarily from the following events:

Hurricane Ian losses, severe weather-related events in the U.S.

and Colorado wildfires.

Hurricane Ida losses, winter storm losses and other severe weather-related events in the U.S.

Refer to the prior period development discussion in Note 6 to the Consolidated Financial Statements for additional information.

Net premiums written increased $92 million, or 7.1 percent, and $237 million, or 6.3 percent for the three and nine months ended September 30, 2022, respectively, primarily driven by strong new business and renewal retention, from both rate and exposure increases, primarily in homeowners and automobile;

partially offset by additional cancellations in parts of California exposed to wildfires.

Net premiums earned increased $90 million, or 7.2 percent, and $200 million, or 5.5 percent for the three and nine months ended September 30, 2022, respectively, reflecting the growth in net premiums written described above.

(Unfavorable) favorable prior period development $ (17) $ 51

Catastrophe losses through March 31, 2023 and 2022, were primarily from the following events:

winter storm losses, flooding, hail, tornadoes, and wind events.

Colorado wildfires and severe weather-related events in the U.S.

Refer to Note 8 in the Consolidated Financial Statements for detail on prior period development.

Net premiums written increased $116 million, or 9.9 percent for the three months ended March 31, 2023, primarily driven by strong new business and renewal retention, from both rate and exposure increases, across all lines, including homeowners, automobile, and excess liability.

Net premiums earned increased $73 million, or 5.9 percent for the three months ended March 31, 2023, reflecting the growth in net premiums written described above.

Combined Ratio

The loss and loss expense ratio decreased for the three and nine months ended September 30, 2022, primarily from lower catastrophe losses, partially offset by lower favorable prior period development.

The CAY loss ratio excluding catastrophe losses increased for the three and nine months ended September 30, 2022, reflecting higher losses in automobile and, to a lesser extent, homeowners.

The policy acquisition cost ratio was relatively flat for the three and nine months ended September 30, 2022.

The administrative expense ratio decreased for the three months ended September 30, 2022, primarily due to a one-time expense accrual release, the favorable impact of higher net premiums earned and strong expense management.

The administrative expense ratio was flat for the nine months ended September 30, 2022.

The loss and loss expense ratio increased for the three months ended March 31, 2023, primarily reflecting the impact of higher catastrophe losses in the current quarter, including a charge of $9 million related to the development from 2022 late-season catastrophes, and a reserve release in the prior year quarter due to lower than expected paid and reported loss activity attributable to the indirect effects of COVID related economic slowdown.

The CAY loss ratio excluding catastrophe losses increased for the three months ended March 31, 2023, primarily reflecting higher auto losses, partially offset by homeowners earned rate and exposure exceeding lost cost trends.

The administrative expense ratio increased for the three months ended March 31, 2023, primarily due to higher year-over-year pension expenses from unfavorable market conditions, partially offset by the favorable impact of higher net premiums earned.

We expect the higher pension expense to continue through 2023.

North America Agricultural Insurance

2 unchanged sentences

(Rain and Hail), as well as farm and ranch and specialty P&C commercial insurance products and services through our Chubb Agribusiness unit.

Three Months Ended Nine Months Ended

September 30 % Change September 30 % Change

Three Months Ended

March 31 % Change

(in millions of U.S.

dollars, except for percentages) 2023 2022 Q-23 vs.

Q-21 2022 2021 YTD-22 vs.

Net premiums written $ 1,723 $ 1,415 21.8 % $ 2,523 $ 2,110 19.6 %

Net premiums earned 1,673 1,338 25.0 % 2,217 1,858 19.3 %

Losses and loss expenses 1,444 1,138 27.0 % 1,830 1,554 17.8 %

Net premiums written $ 293 $ 62 NM

Net premiums earned 159 (29) NM

Losses and loss expenses 140 (92) NM

Policy acquisition costs 15 12 24.3 %

Administrative expenses 3 4 (21.4) % 4 10 (58.1) %

Administrative expenses 3 (1) NM

Underwriting income 1 52 (97.7) %

Net investment income 17 7 152.1 %

Other (income) expense 1 — NM 1 — NM

Other (income) expense 1 — NM

Amortization of purchased intangibles 6 7 (2.4) %

1 unchanged sentence

Loss and loss expense ratio:

CAY loss ratio excluding catastrophe losses 84.0 % 84.0 % — pts 82.2 % 82.3 % (0.1) pts

Catastrophe losses 1.8 % 0.6 % 1.2 pts 2.3 % 1.1 % 1.2 pts

Prior period development 0.5 % 0.4 % 0.1 pts (2.0) % 0.2 % (2.2) pts

Loss and loss expense ratio 86.3 % 85.0 % 1.3 pts 82.5 % 83.6 % (1.1) pts

Policy acquisition cost ratio 4.1 % 4.6 % (0.5) pts 5.1 % 5.4 % (0.3) pts

Administrative expense ratio 0.2 % 0.3 % (0.1) pts 0.2 % 0.6 % (0.4) pts

Combined ratio 90.6 % 89.9 % 0.7 pts 87.8 % 89.6 % (1.8) pts

CAY loss ratio excluding catastrophe losses 73.1 % 70.6 % 2.5 pts

Catastrophe losses 15.4 % NM NM

Prior period development — NM NM

Loss and loss expense ratio 88.5 % NM NM

Policy acquisition cost ratio 9.3 % NM NM

Administrative expense ratio 1.4 % NM NM

Combined ratio 99.2 % NM NM

NM - not meaningful

Catastrophe Losses and Prior Period Development Three Months Ended Nine Months Ended

September 30 September 30

Catastrophe Losses and Prior Period Development Three Months Ended

(in millions of U.S.

1 unchanged sentence

Catastrophe losses $ 24 $ —

(Unfavorable) favorable prior period development $ (9) $ (7) $ 17 $ (5)

Catastrophe losses through September 30, 2022 and 2021, were primarily from the following events:

Hurricane Ian losses, severe weather-related events in the Chubb Agribusiness, and winter storm losses in the U.S.

Severe weather-related events in Chubb Agribusiness and winter storm losses in the U.S.

Refer to the prior period development discussion in Note 6 to the Consolidated Financial Statements for additional information.

Net premiums written increased $308 million, or 21.8 percent for the three months ended September 30, 2022, primarily due to an increase in MPCI, primarily reflecting higher commodity prices, higher reported acreage from policyholders, and policy count growth.

Net premiums written increased $413 million, or 19.6 percent for the nine months ended September 30, 2022, primarily due to an increase in MPCI reflecting the factors noted above, partly offset by a return of premium to the U.S.

government in the first quarter of 2022 of $161 million.

Favorable prior period development $ — $ 26

Catastrophe losses through March 31, 2023, were primarily from U.S.

flooding, hail, tornadoes, wind events, and winter storm losses.

Refer to Note 8 in the Consolidated Financial Statements for detail on prior period development.

Net premiums written increased $231 million for the three months ended March 31, 2023, reflecting growth in MPCI due to higher commodity prices, and strong new business in Chubb Agribusiness.

In addition, growth reflects the return of premium to the U.S.

government of $161 million in the first quarter of 2022 as part of the profit-sharing agreement.

Under the profit-sharing agreement, we returned additional premiums to the government because of the lower losses experienced in certain states in 2021.

This return of premium reduced net premiums written growth for the nine months ended September 30, 2022, by 7.6 percentage points.

Net premiums earned increased $335 million, or 25.0 percent, and $359 million, or 19.3 percent for the three and nine months ended September 30, 2022, respectively, reflecting the growth in net premiums written described above.

Net premiums earned increased $188 million for the three months ended March 31, 2023, reflecting the factors described above.

Combined Ratio

The combined ratio for the nine months ended September 30, 2022, was impacted by the return of premium to the U.S.

government under the profit-sharing agreement related to the profitable 2021 crop year described above.

This prior period development resulted in a reduction to net premiums earned of $161 million and a corresponding reduction to incurred losses, with no net impact to underwriting income.

The loss and loss expense ratio increased for the three months ended September 30, 2022, primarily from higher catastrophe losses.

The loss and loss expense ratio decreased for the nine months ended September 30, 2022, primarily due to favorable prior period development compared with unfavorable prior period development in the prior year, partially offset by higher catastrophe losses.

The CAY loss ratio excluding catastrophe losses was relatively flat for the three and nine months ended September 30, 2022.

The policy acquisition cost ratio decreased for the three and nine months ended September 30, 2022, primarily due to the favorable impact of higher net premiums earned from MPCI.

The administrative expense ratio decreased for the three and nine months ended September 30, 2022, reflecting the favorable impact of higher net premiums earned from MPCI, higher Administrative and Operating (A&O) reimbursements on the MPCI business, and strong expense management.

The CAY loss ratio excluding catastrophe losses increased for the three months ended March 31, 2023, primarily from higher premiums earned from MPCI, which have a higher loss ratio, and a 1.5 percentage point increase from a year-over-year impact from our crop commodity price hedge activity which produced a loss this quarter versus a gain last year.

The CAY administrative expense ratio increased for the three months ended March 31, 2023, reflecting lower Administrative and Operating (A&O) reimbursements on the MPCI business.

Overseas General Insurance

4 unchanged sentences

Chubb provides funds at Lloyd's to support underwriting by Syndicate 2488 which is managed by Chubb Underwriting Agencies Limited.

Three Months Ended Nine Months Ended

September 30 % Change September 30 % Change

Three Months Ended

March 31 % Change

(in millions of U.S.

dollars, except for percentages) 2023 2022 Q-23 vs.

Q-21 2022 2021 YTD-22 vs.

Net premiums written $ 3,263 $ 3,079 6.0 %

1 unchanged sentence

Net premiums earned 2,786 2,628 6.0 %

Losses and loss expenses 1,441 1,487 (3.1) % 4,054 3,936 3.0 %

Loss and loss expenses 1,237 1,296 (4.6) %

Policy benefits 110 93 18.3 %

Policy acquisition costs 713 679 4.9 %

6 unchanged sentences

Loss and loss expense ratio:

CAY loss ratio excluding catastrophe losses 49.2 % 49.8 % (0.6) pts 49.5 % 50.1 % (0.6) pts

Catastrophe losses 3.6 % 7.0 % (3.4) pts 3.7 % 3.6 % 0.1 pts

Prior period development (0.2) % (1.0) % 0.8 pts (2.9) % (2.7) % (0.2) pts

Loss and loss expense ratio 52.6 % 55.8 % (3.2) pts 50.3 % 51.0 % (0.7) pts

Policy acquisition cost ratio 26.3 % 26.4 % (0.1) pts 26.0 % 26.8 % (0.8) pts

Administrative expense ratio 9.6 % 10.0 % (0.4) pts 10.0 % 10.5 % (0.5) pts

Combined ratio 88.5 % 92.2 % (3.7) pts 86.3 % 88.3 % (2.0) pts

CAY loss ratio excluding catastrophe losses 49.4 % 49.4 % — pts

Catastrophe losses 4.1 % 5.8 % (1.7) pts

Prior period development (5.1) % (2.3) % (2.8) pts

Loss and loss expense ratio 48.4 % 52.9 % (4.5) pts

Policy acquisition cost ratio 25.6 % 25.8 % (0.2) pts

Administrative expense ratio 10.0 % 10.2 % (0.2) pts

Combined ratio 84.0 % 88.9 % (4.9) pts

NM- Not meaningful

Catastrophe Losses and Prior Period Development

Three Months Ended Nine Months Ended

September 30 September 30

Three Months Ended

(in millions of U.S.

2 unchanged sentences

Favorable prior period development $ 143 $ 60

Catastrophe losses through September 30, 2022 and 2021, were primarily from the following events:

Hurricane Ian losses, International weather-related events, and storms in Australia.

Flooding in Europe, Hurricane Ida, winter storm losses and international weather-related events.

Refer to the prior period development discussion in Note 6 to the Consolidated Financial Statements for additional information.

Catastrophe losses through March 31, 2023 and 2022, were primarily from the following events:

Storms in New Zealand and international weather-related events.

Storms in Australia and international weather-related events.

Refer to Note 8 to the Consolidated Financial Statements for detail on prior period development.

Net Premiums Written by Region

Three months ended September 30

Three months ended March 31

(in millions of U.S.

9 unchanged sentences

Net premiums written $ 3,263 100 % $ 3,079 100 % $ 2,966 6.0 % 10.0 %

Nine months ended September 30

(in millions of U.S.

dollars, except for percentages) 2022 2022

% of Total 2021 2021

% of Total C$

2021 Y-22 vs.

Europe, Middle East, and Africa $ 3,990 48 % $ 3,912 49 % $ 3,643 2.0 % 9.5 %

Latin America 1,719 21 % 1,489 18 % 1,434 15.5 % 19.9 %

Asia Pacific 2,134 25 % 1,987 25 % 1,857 7.4 % 15.0 %

Japan 359 4 % 402 6 % 349 (10.7) % 2.7 %

162 2 % 193 2 % 186 (16.3) % (13.1) %

Net premiums written $ 8,364 100 % $ 7,983 100 % $ 7,469 4.8 % 12.0 %

(1) Includes the international supplemental A&H business of Combined Insurance and other international operations including mainland China.

Overall, net premiums written increased $49 million and $381 million, or $276 million and $895 million on a constant dollar basis, for the three and nine months ended September 30, 2022, respectively, reflecting growth in both commercial and consumer lines.

For the three and nine months ended September 30, 2022, commercial lines grew 2.5 percent and 6.1 percent, or 11.0 percent and 12.6 percent on a constant-dollar basis, respectively, and consumer lines grew 1.1 percent and 2.7 percent, or 12.7 percent and 11.0 percent on a constant-dollar basis, respectively.

The acquisition of Cigna's business in Asia contributed $39 million for the three and nine months ended September 30, 2022.

Our European division increased for the three and nine months ended September 30, 2022 on a constant dollar basis, supported by both our wholesale and retail divisions.

This growth was primarily driven by higher new business, and positive rate increases in commercial lines, including commercial property and casualty lines.

Consumer lines increased primarily due to A&H, reflecting increased travel volume.

Additionally, A&H in the prior year was adversely impacted by restrictions resulting from the COVID-19 pandemic.

Latin America increased for the three and nine months ended September 30, 2022 driven by growth in consumer lines, including automobile in personal and travel in A&H.

Commercial lines also grew due to exposure increases, positive rate increases, and new business, primarily property.

Asia Pacific increased for the three and nine months ended September 30, 2022 driven by higher new business, higher retention and positive rate increases in commercial lines, including property and casualty, and financial lines, and growth in consumer lines, primarily specialty and high net worth in personal, and travel in A&H.

The acquisition of Cigna's business in Thailand also contributed to the increase, as described above.

Japan increased for the three and nine months ended September 30, 2022 on a constant-dollar basis primarily from new business in A&H.

Net premiums earned increased $77 million and $344 million, or $317 million and $848 million on a constant-dollar basis, for the three and nine months ended September 30, 2022, respectively, reflecting the increase in net premiums written described above.

Net premiums written increased $184 million, or $297 million on a constant dollar basis, for the three months ended March 31, 2023, reflecting growth in commercial lines of 6.2 percent, or 10.8 percent on a constant-dollar basis, and growth in consumer lines of 5.6 percent, or 8.6 percent on a constant-dollar basis.

Our European division increased for the three months ended March 31, 2023, supported by both our wholesale and retail divisions.

The growth in commercial lines of 6.0 percent, or 11.7 percent on a constant-dollar basis, was primarily driven by higher new business, and positive rate increases, including commercial property and casualty lines.

Consumer lines declined 2.9 percent, but grew 4.5 percent on a constant-dollar basis primarily due to increased travel volume in A&H.

Latin America increased for the three months ended March 31, 2023.

The growth in commercial lines of 10.1 percent, or 9.4 percent on a constant-dollar basis, is driven by exposure increases, positive rate increases, and new business, primarily property and casualty lines.

Consumer lines grew 8.5 percent, or 2.4 percent on a constant-dollar basis due to increased A&H.

Asia Pacific increased for the three months ended March 31, 2023.

The growth in commercial lines of 11.3 percent, or 14.9 percent on a constant-dollar basis, is driven by higher new business, higher retention and positive rate increases, including property and casualty lines.

The growth in consumer lines of 16.7 percent, or 22.5 percent on a constant-dollar basis, increased primarily from travel in A&H.

The acquisition of Cigna's business in Asia contributed $34 million in 2023.

Japan increased for the three months ended March 31, 2023, on a constant-dollar basis, primarily from higher new business in A&H.

Net premiums earned increased $158 million, or $252 million on a constant-dollar basis, for the three months ended March 31, 2023, reflecting the increase in commercial and consumer net premiums written described above.

Combined Ratio

The loss and loss expense ratio decreased for the three months ended September 30, 2022, due to lower catastrophe losses, partially offset by lower favorable prior period development.

The loss and loss expense ratio decreased for the nine months ended September 30, 2022, due to higher favorable prior period development.

The CAY loss ratio excluding catastrophe losses decreased for the three and nine months ended September 30, 2022, primarily reflecting underlying loss ratio improvement, including earned rate exceeding loss cost trends.

The policy acquisition cost ratio decreased for the three and nine months ended September 30, 2022, primarily due to a change in the mix of business, including higher premiums earned from commercial lines that have a lower acquisition cost ratio than consumer lines.

The administrative expense ratio decreased for the three and nine months ended September 30, 2022, reflecting continued expense management control and the favorable impact of higher net premiums earned.

The loss and loss expense ratio decreased for the three months ended March 31, 2023, due to lower catastrophe losses and higher favorable prior period development related to a reserve release from 2022 late-season catastrophes.

The policy acquisition cost ratio decreased for the three months ended March 31, 2023, primarily due to a change in the mix of business, including less premiums earned from personal lines that have a higher acquisition cost ratio and higher premiums earned from commercial lines that have a lower acquisition cost ratio than consumer lines.

The administrative expense ratio decreased for the three months ended March 31, 2023, reflecting the favorable impact of higher net premiums earned, partially offset by increased investment to support growth.

Global Reinsurance

1 unchanged sentence

Global Reinsurance markets its reinsurance products worldwide primarily through reinsurance brokers under the Chubb Tempest Re brand name and provides a broad range of traditional and non-traditional reinsurance coverage to a diverse array of primary P&C companies.

Three Months Ended Nine Months Ended

September 30 % Change September 30 % Change

Three Months Ended

March 31 % Change

(in millions of U.S.

dollars, except for percentages) 2023 2022 Q-23 vs.

Q-21 2022 2021 YTD-22 vs.

Net premiums written $ 277 $ 253 9.4 %

4 unchanged sentences

Administrative expenses 9 9 9.0 %

Underwriting loss (123) (45) 172.5 % (58) (13) NM

Underwriting income 61 49 23.2 %

Net investment income 49 85 (41.6) %

Other (income) expense (1) — NM

Segment income (loss) $ (52) $ 54 NM $ 173 $ 237 (27.2) %

Segment income $ 111 $ 134 (16.8) %

Loss and loss expense ratio:

CAY loss ratio excluding catastrophe losses 49.6 % 52.0 % (2.4) pts 49.8 % 50.5 % (0.7) pts

Catastrophe losses 72.6 % 41.7 % 30.9 pts 26.1 % 24.2 % 1.9 pts

Prior period development (0.1) % (2.5) % 2.4 pts 3.5 % (2.3) % 5.8 pts

Loss and loss expense ratio 122.1 % 91.2 % 30.9 pts 79.4 % 72.4 % 7.0 pts

Policy acquisition cost ratio 22.9 % 26.0 % (3.1) pts 25.0 % 25.2 % (0.2) pts

Administrative expense ratio 3.4 % 4.2 % (0.8) pts 3.8 % 4.6 % (0.8) pts

Combined ratio 148.4 % 121.4 % 27.0 pts 108.2 % 102.2 % 6.0 pts

CAY loss ratio excluding catastrophe losses 49.0 % 49.9 % (0.9) pts

Catastrophe losses — 0.4 % (0.4) pts

Prior period development (3.3) % (1.5) % (1.8) pts

Loss and loss expense ratio 45.7 % 48.8 % (3.1) pts

Policy acquisition cost ratio 25.6 % 26.5 % (0.9) pts

Administrative expense ratio 3.8 % 3.7 % 0.1 pts

Combined ratio 75.1 % 79.0 % (3.9) pts

NM - not meaningful

Catastrophe Losses and Prior Period Development

Three Months Ended Nine Months Ended

September 30 September 30

Three Months Ended

(in millions of U.S dollars) 2023 2022

Catastrophe losses $ — $ 1

Favorable (Unfavorable) prior period development $ — $ 4 $ (22) $ 11

Catastrophe losses through September 30, 2022, were primarily from Hurricane Ian, and storms in Australia and Canada.

Catastrophe losses through September 30, 2021, were primarily from severe weather-related events in the U.S.

and Canada, including Hurricane Ida.

Net premiums written increased $44 million and $78 million for the three and nine months ended September 30, 2022, respectively, primarily due to higher catastrophe reinstatement premiums, continued growth in the portfolio from new business and favorable premium adjustments.

Growth for the nine months ended September 30, 2022 was partially offset by a one-time portfolio transfer in the prior year.

Net premiums earned increased $44 million and $129 million for the three and nine months ended September 30, 2022, respectively, primarily reflecting the factors described above.

The increase for the nine months ended September 30, 2022 was also due to the impact of higher new business written in the prior year for which premiums are earned in the current year.

Favorable prior period development $ 8 $ 3

Refer to Note 8 in the Consolidated Financial Statements for detail on prior period development.

Net premiums written increased $24 million for the three months ended March 31, 2023, primarily due to continued growth in the portfolio, driven by new business.

Net premiums earned increased $9 million for the three months ended March 31, 2023, primarily reflecting the increase in net premiums written described above.

Combined Ratio

The loss and loss expense ratio increased for the three and nine months ended September 30, 2022, primarily due to higher catastrophe losses and the unfavorable impact of prior period development.

The CAY loss ratio excluding catastrophe losses decreased for the three and nine months ended September 30, 2022 primarily due to a shift in the mix of business.

The policy acquisition cost ratio decreased for the three and nine months ended September 30, 2022, primarily due to catastrophe reinstatement premiums, which were fully earned in the three months ended September 30, 2022 and more than offset the impact of a shift in the mix of business.

The administrative expense ratio decreased for the three and nine months ended September 30, 2022, primarily from the favorable impact of higher net premiums earned.

The loss and loss expense ratio and the CAY loss ratio excluding catastrophe losses decreased for the three months ended March 31, 2023, reflecting loss ratio improvement in multiple lines of business, including earned rate exceeding loss cost

The loss and loss expense ratio also benefited from more favorable prior period development and lower catastrophe losses.

The policy acquisition cost ratio decreased for the three months ended March 31, 2023, primarily due to a treaty written in the current quarter with a low acquisition cost ratio.

The administrative expense ratio increased for the three months ended March 31, 2023, primarily due to employee-related expenses, offset by the favorable impact of higher net premiums earned.

Life Insurance

The Life Insurance segment comprises our international life operations, which commencing this quarter, includes Cigna's A&H and life business in six Asian markets acquired on July 1, 2022.

The Life Insurance segment comprises our international life operations, which commencing in the third quarter of 2022, includes Cigna's A&H and life business in Korea, Taiwan, New Zealand, Hong Kong, and Indonesia, acquired on July 1, 2022.

The Life Insurance segment also includes Chubb Tempest Life Re (Chubb Life Re), and the North American supplemental A&H and life business of Combined Insurance.

We assess the performance of our life business based on Life Insurance underwriting income, which includes Net investment income and (Gains) losses from fair value changes in separate account assets that do not qualify for separate account reporting under GAAP.

Three Months Ended Nine Months Ended

September 30 % Change September 30 % Change

Results for the three months ended March 31, 2022 are adjusted to reflect the adoption of LDTI.

Refer to Note 1 c).

Three Months Ended

March 31 % Change

(in millions of U.S.

dollars, except for percentages) 2023 2022 Q-23 vs.

Q-21 2022 2021 YTD-22 vs.

Net premiums written $ 1,293 $ 576 124.4 %

2 unchanged sentences

Losses and loss expenses 32 24 33.3 %

Policy benefits 553 175 NM 906 508 78.4 %

Policy benefits 712 311 128.9 %

Policy acquisition costs 273 133 104.4 %

1 unchanged sentence

Net investment income 153 103 47.8 %

Life Insurance underwriting income 263 87 197.7 % 444 235 88.3 %

Other (income) expense (15) (30) (49.4) %

1 unchanged sentence

Segment income $ 244 $ 121 102.0 %

NM- Not meaningful

Net premiums written increased $664 million and $586 million, or $687 million and $637 million on a constant-dollar basis, for the three and nine months ended September 30, 2022, respectively.

For our international life operations, net premiums written increased 214.1 percent and 67.9 percent for the three and nine months ended September 30, 2022, respectively, primarily due to the acquisition of Cigna's business in Asia, which contributed $699 million.

In addition, there was growth in Asia from new business, principally in Thailand, Indonesia and Vietnam, which was more than offset by lower business in Latin America, principally reflecting non-renewals of certain large account business in Chile.

Net premiums written in our North American Combined Insurance business declined 8.6 percent and 8.7 percent, for the three and nine months ended September 30, 2022, respectively, primarily due to the non-renewal of a large program.

Net premiums written increased $717 million, or $728 million on a constant-dollar basis, for the three months ended March 31, 2023.

For our international life operations, net premiums written increased 237.7 percent primarily due to the acquisition of Cigna's business in Asia, which contributed $724 million.

In addition, there was growth from new business in Latin America and Asia, principally in Hong Kong.

Net premiums written in our North American Combined Insurance business declined 7.0 percent primarily due to the non-renewal of a large program.

The following table presents deposits collected on universal life and investment contracts:

Three Months Ended Nine Months Ended

September 30 % Change September 30 % Change

Three Months Ended

March 31 % Change

(in millions of U.S.

1 unchanged sentence

2022 Q-23 vs.

Q-21 2022 2021 C$ 2021 Y-22 vs.

Deposits collected on universal life and investment contracts $ 309 $ 557 $ 511 (44.4) % (39.5) %

Deposits collected on universal life and investment contracts (life deposits) are not reflected as revenues in our Consolidated statements of operations in accordance with GAAP.

New life deposits are an important component of production, and although they do not significantly affect current period income from operations, they are key to our efforts to grow our business.

Life deposits collected decreased $209 million and $381 million for the three and nine months ended September 30, 2022, respectively, primarily in Taiwan, reflecting challenging market conditions for deposit products.

Additionally, the prior year benefited from successful sales campaigns in broker and bank channels in Taiwan.

Partially offsetting the decline is $36 million from deposits collected through the acquired Cigna businesses in Asia, primarily in Korea.

Life Insurance underwriting income and Segment income

Life Insurance underwriting income increased $176 million and $209 million for the three and nine months ended

September 30, 2022, respectively, with $159 million of growth from the acquisition of Cigna's business in Asia, and lower year-over-year COVID-related losses.

Segment income increased $167 million and $177 million for the three and nine months ended September 30, 2022, respectively, reflecting the increase in underwriting income described above.

New life deposits are an important component of production, and although

they do not significantly affect current period income from operations, they are key to our efforts to grow our business.

Life deposits collected decreased $248 million for the three months ended March 31, 2023, primarily in Taiwan, reflecting challenging market conditions for deposit products.

Life Insurance segment income

Life Insurance segment income increased $123 million for the three months ended March 31, 2023, reflecting $159 million of growth from the acquisition of Cigna's business in Asia, partially offset by lower income from our investment in Huatai, our partially-owned insurance entity in China.

Corporate results primarily include the results of our non-insurance companies, income and expenses not attributable to reportable segments and loss and loss expenses of asbestos and environmental (A&E) liabilities and certain other non-A&E run-off exposures, including molestation.

Three Months Ended Nine Months Ended

September 30 % Change September 30 % Change

Results for the three months ended March 31, 2022 are adjusted to reflect the adoption of LDTI.

Refer to Note 1 c).

Three Months Ended

March 31 % Change

(in millions of U.S.

dollars, except for percentages) 2023 2022 Q-23 vs.

Q-21 2022 2021 YTD-22 vs.

Losses and loss expenses $ 11 $ 10 22.9 %

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Net investment income (loss) 11 (5) NM

Interest expense 150 122 23.3 % 416 366 13.8 %

Net realized gains (losses) (365) (11) NM (778) 841 NM

Other (income) expense 194 (722) NM 73 (1,845) NM

Other (income) expense (214) (259) (17.9) %

Amortization of purchased intangibles 42 46 (6.7) %

Cigna integration expenses 23 — NM 26 — NM

Net realized gains (losses) (76) 22 NM

Market risk benefits gains (losses) (115) 49 NM

Interest expense 160 132 21.6 %

Cigna integration expenses 22 — NM

Income tax expense 384 353 8.7 %

Net income (loss) $ (1,203) $ 170 NM $ (2,886) $ 858 NM

Net loss $ (682) $ (299) 130.1 %

NM - not meaningful

Losses and loss expenses for the three months ended September 30, 2022 and 2021 were primarily from adverse development relating to our Brandywine environmental exposures of $52 million and $33 million, respectively.

Losses and loss expenses for the nine months ended September 30, 2022 also includes unfavorable prior period development for molestation claims.

Administrative expenses decreased $8 million for the three months ended September 30, 2022, primarily due to lower employee-related expenses.

Administrative expenses increased $6 million for the nine months ended September 30, 2022, primarily due to increased spending to support digital growth initiatives.

Cigna integration expenses of $23 million and $26 million for the three and nine months ended September 30, 2022, respectively, principally comprised transfer taxes and employee-related expenses.

Administrative expenses increased $14 million for the three months ended March 31, 2023, primarily due to increased spending to support digital growth initiatives.

Cigna integration expenses of $22 million for the three months ended March 31, 2022, principally comprised legal and professional fees and all other costs directly related to the integration activities of the Cigna acquisition.

These expenses are one-time in nature and are not related to the on-going business activities of the segments.

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Refer to the respective sections that follow for a discussion of Net realized gains (losses), Net investment income (loss), Amortization of purchased intangibles, and Income tax expense (benefit).

Refer to Note 12 to the Consolidated Financial Statements for additional information on Other (income) expense.

Refer to Notes 11 and 17 to the Consolidated Financial Statements for additional information on Market risk benefits gains (losses) and Other (income) expense, respectively.

Net Realized and Unrealized Gains (Losses)

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For a further discussion related to how we assess the valuation allowance for expected credit losses and the related impact on Net income, refer to Note 1 e) to the Consolidated Financial Statements in our 2022 Form 10-K.

Additionally, Net income is impacted through the reporting of changes in the fair value of equity securities, private equity funds where we own less than three percent, and derivatives, including financial futures, options, swaps, and GLB reinsurance.

Changes in unrealized appreciation and depreciation on available for sale securities, resulting from the revaluation of securities held, changes in cumulative foreign currency translation adjustment, and unrealized postretirement benefit obligations liability adjustment, are reported as separate components of Accumulated other comprehensive income in Shareholders’ equity in the Consolidated balance sheets.

Additionally, Net income is impacted through the reporting of changes in the fair value of public and private equity securities and derivatives, including financial futures, options, and swaps.

Changes in unrealized appreciation and depreciation on available for sale securities, resulting from the revaluation of securities held, changes in cumulative foreign currency translation adjustment, changes in current discount rate on future policy benefits, changes in instrument-specific credit risk on market risk benefits, unrealized postretirement benefit obligations liability adjustment, and cross-currency swaps designated as hedges for accounting purposes are reported as separate components of Accumulated other comprehensive income (loss) in Shareholders’ equity in the Consolidated balance sheets.

The following tables present our net realized and unrealized gains (losses):

Three Months Ended September 30

(in millions of U.S.

Fixed maturities $ (279) $ (3,045) $ (3,324) $ (10) $ (554) $ (564)

Fixed income and investment derivatives (198) — (198) (9) — (9)

Public equity

Sales (12) — (12) 19 — 19

Mark-to-market (68) — (68) (61) — (61)

Private equity (less than 3 percent ownership)

Mark-to-market (42) — (42) 11 — 11

Total investment portfolio (599) (3,045) (3,644) (50) (554) (604)

Mark-to-market from variable annuity reinsurance derivative transactions, net of applicable hedges 76 — 76 (63) — (63)

Other derivatives (19) — (19) (10) — (10)

Foreign exchange 198 (966) (768) 106 (414) (308)

(40) (59) (99) (4) 4 —

Net losses, pre-tax $ (384) $ (4,070) $ (4,454) $ (21) $ (964) $ (985)

(1) Other realized losses includes $36 million related to impairment of fixed assets.

Nine Months Ended September 30

Three Months Ended March 31

(As Adjusted)

(in millions of U.S.

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Total investment portfolio (200) 1,786 1,586 22 (4,652) (4,630)

Mark-to-market from variable annuity reinsurance derivative transactions, net of applicable hedges 154 — 154 140 — 140

Other derivatives (1) — (1) 1 — 1

Foreign exchange 131 (177) (46) 74 67 141

(114) (35) (149) (5) (33) (38)

Current discount rate on future policy benefits — (151) (151) — 435 435

Instrument-specific credit risk on market risk benefits — (3) (3) — 23 23

Other (7) (33) (40) (74) 19 (55)

Net gains (losses), pre-tax $ (77) $ 1,422 $ 1,345 $ 23 $ (4,108) $ (4,085)

(1) Other realized losses includes $36 million related to impairment of fixed assets.

Pre-tax net unrealized losses of $3,045 million and $12,041 million in our investment portfolio for the three and nine months ended September 30, 2022, respectively, were principally the result of an increase in interest rates.

In addition, there were realized losses of $599 million and $1,359 million for the three and nine months ended September 30, 2022, respectively, primarily from mark-to-market losses on public equities and sales in fixed income securities.

The variable annuity reinsurance derivative transactions consist of changes in the fair value of GLB liabilities and gains or losses on other derivative instruments we maintain that decrease in fair value when the S&P 500 index increases.

The variable annuity reinsurance derivative transactions resulted in realized gains of $76 million for the three months ended September 30, 2022, reflecting a net gain of $22 million, primarily from a decrease in the fair value of the GLB liabilities due to higher interest rates, partially offset by lower global equity markets and changes made to our valuation model relating to policyholder behavior, and a net realized gain of $54 million related to these other derivative instruments.

The variable annuity reinsurance derivative transactions resulted in realized gains of $154 million for the nine months ended September 30, 2022, reflecting a net loss of $86 million, primarily from an increase in the fair value of the GLB liabilities due to lower global equity markets and changes to our valuation model relating to policyholder behavior, partially offset by higher interest rates, and a net realized gain of $240 million related to these other derivative instruments.

For the three months ended September 30, 2021, the variable annuity reinsurance derivative transactions resulted in realized losses of $63 million, reflecting a net loss of $59 million, primarily from an increase in the fair value of the GLB liabilities due to underperformance in certain equity markets, partially offset by an increase in interest rates, and a net realized loss of $4 million related to these other derivatives.

For the nine months ended September 30, 2021, the variable annuity reinsurance derivative transactions resulted in net realized gains of $140 million reflecting a net gain of $252 million, principally related to a decrease in the fair value of the GLB liabilities due to higher interest rates and higher global equity markets, partially offset by a net realized loss of $112 million related to these other derivatives.

Pre-tax net unrealized gains of $1,786 million in our investment portfolio for the three months ended March 31, 2023 were principally the result of a decrease in interest rates.

In addition, there were pre-tax net realized losses of $200 million, comprising losses from sales of fixed maturities, derivative losses, and impairments on fixed income securities.

Effective Income Tax Rate

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A change in the geographic mix of earnings could impact our ETR.

For the three and nine months ended September 30, 2022 our ETR was 24.6 percent and 18.6 percent, respectively.

This compares to an ETR of 10.7 percent and 12.0 percent for the three and nine months ended September 30, 2021, respectively.

The ETR for each period in 2022 was impacted by the acquisition of Cigna's business in Asia, our mix of earnings among various jurisdictions, and discrete tax benefits.

For the three months ended March 31, 2023 our ETR was 16.9 percent compared to 15.3 percent in the prior year period.

The increase in the ETR from the prior year period was due to an increase in income in higher tax rate jurisdictions driven by the Cigna acquisition and an increase in the enacted UK tax rate, partially offset by discrete tax items.

Non-GAAP Reconciliation

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Three Months Ended

September 30, 2022

(in millions of U.S.

dollars except for ratios)

Losses and loss expenses A $ 3,036 $ 857 $ 1,444 $ 1,441 $ 311 $ 74 $ 7,163

Catastrophe losses and related adjustments

Catastrophe losses, net of related adjustments (598) (274) (31) (98) (157) — (1,158)

Reinstatement premiums collected (expensed) on catastrophe losses — — — — 55 — 55

Catastrophe losses, gross of related adjustments (598) (274) (31) (98) (212) — (1,213)

PPD and related adjustments

PPD, net of related adjustments - favorable (unfavorable) 166 133 (9) 5 — (73) 222

Net premiums earned adjustments on PPD - unfavorable (favorable) 80 — — — — — 80

Expense adjustments - unfavorable (favorable) (1) — — — — — (1)

PPD, gross of related adjustments - favorable (unfavorable) 245 133 (9) 5 — (73) 301

CAY loss and loss expense ex CATs B $ 2,683 $ 716 $ 1,404 $ 1,348 $ 99 $ 1 $ 6,251

Policy acquisition costs and administrative expenses

Policy acquisition costs and administrative expenses C $ 855 $ 345 $ 71 $ 984 $ 67 $ 91 $ 2,413

Expense adjustments - favorable (unfavorable) 1 — — — — — 1

Policy acquisition costs and administrative expenses, adjusted D $ 856 $ 345 $ 71 $ 984 $ 67 $ 91 $ 2,414

Net premiums earned E $ 4,283 $ 1,334 $ 1,673 $ 2,741 $ 255 $ 10,286

Reinstatement premiums (collected) expensed on catastrophe losses — — — — (55) (55)

Net premiums earned adjustments on PPD - unfavorable (favorable) 80 — — — — 80

Net premiums earned excluding adjustments F $ 4,363 $ 1,334 $ 1,673 $ 2,741 $ 200 $ 10,311

P&C Combined ratio

Loss and loss expense ratio A/E 70.9 % 64.2 % 86.3 % 52.6 % 122.1 % 69.6 %

Policy acquisition cost and administrative expense ratio C/E 20.0 % 25.9 % 4.3 % 35.9 % 26.3 % 23.5 %

P&C Combined ratio 90.9 % 90.1 % 90.6 % 88.5 % 148.4 % 93.1 %

CAY P&C Combined ratio ex CATs

Loss and loss expense ratio, adjusted B/F 61.5 % 53.6 % 84.0 % 49.2 % 49.6 % 60.6 %

Policy acquisition cost and administrative expense ratio, adjusted D/F 19.6 % 25.9 % 4.2 % 35.9 % 33.4 % 23.4 %

CAY P&C Combined ratio ex CATs 81.1 % 79.5 % 88.2 % 85.1 % 83.0 % 84.0 %

Combined ratio

Combined ratio 92.9 %

impact of gains and losses on crop derivatives 0.2 %

P&C Combined ratio 93.1 %

The ratios above are calculated using whole U.S.

Accordingly, calculations using rounded amounts may differ.

Letters A, B, C, D, E, and F included in the table are references for calculating the ratios above.

North America Commercial P&C Insurance North America Personal P&C Insurance North America Agricultural Insurance Overseas General Insurance Global Reinsurance Corporate Total P&C

Three Months Ended

September 30, 2021

(in millions of U.S.

dollars except for ratios)

Losses and loss expenses A $ 2,754 $ 846 $ 1,138 $ 1,487 $ 192 $ 43 $ 6,460

Catastrophe losses and related adjustments

Catastrophe losses, net of related adjustments (472) (397) (8) (188) (81) — (1,146)

Reinstatement premiums collected (expensed) on catastrophe losses — — — — 12 — 12

Catastrophe losses, gross of related adjustments (472) (397) (8) (188) (93) — (1,158)

PPD and related adjustments

PPD, net of related adjustments - favorable (unfavorable) 157 182 (7) 28 4 (43) 321

Net premiums earned adjustments on PPD - unfavorable (favorable) 56 — — — — — 56

Expense adjustments - unfavorable (favorable) 3 — — — — — 3

PPD reinstatement premiums - unfavorable (favorable) — (2) — — 3 — 1

PPD, gross of related adjustments - favorable (unfavorable) 216 180 (7) 28 7 (43) 381

CAY loss and loss expense ex CATs B $ 2,498 $ 629 $ 1,123 $ 1,327 $ 106 $ — $ 5,683

Policy acquisition costs and administrative expenses

Policy acquisition costs and administrative expenses C $ 810 $ 327 $ 65 $ 969 $ 64 $ 99 $ 2,334

Expense adjustments - favorable (unfavorable) (3) — — — — — (3)

Policy acquisition costs and administrative expenses, adjusted D $ 807 $ 327 $ 65 $ 969 $ 64 $ 99 $ 2,331

Net premiums earned E $ 3,954 $ 1,244 $ 1,338 $ 2,664 $ 211 $ 9,411

Reinstatement premiums (collected) expensed on catastrophe losses — — — — (12) (12)

Net premiums earned adjustments on PPD - unfavorable (favorable) 56 — — — — 56

PPD reinstatement premiums - unfavorable (favorable) — (2) — — 3 1

Net premiums earned excluding adjustments F $ 4,010 $ 1,242 $ 1,338 $ 2,664 $ 202 $ 9,456

P&C Combined ratio

Loss and loss expense ratio A/E 69.7 % 68.0 % 85.0 % 55.8 % 91.2 % 68.6 %

Policy acquisition cost and administrative expense ratio C/E 20.4 % 26.3 % 4.9 % 36.4 % 30.2 % 24.8 %

P&C Combined ratio 90.1 % 94.3 % 89.9 % 92.2 % 121.4 % 93.4 %

CAY P&C Combined ratio ex CATs

Loss and loss expense ratio, adjusted B/F 62.3 % 50.7 % 84.0 % 49.8 % 52.0 % 60.1 %

Policy acquisition cost and administrative expense ratio, adjusted D/F 20.1 % 26.3 % 4.9 % 36.4 % 31.5 % 24.7 %

CAY P&C Combined ratio ex CATs 82.4 % 77.0 % 88.9 % 86.2 % 83.5 % 84.8 %

Combined ratio

Combined ratio 93.3 %

impact of gains and losses on crop derivatives 0.1

P&C Combined ratio 93.4 %

The ratios above are calculated using whole U.S.

Accordingly, calculations using rounded amounts may differ.

Letters A, B, C, D, E, and F included in the table are references for calculating the ratios above.

North America Commercial P&C Insurance North America Personal P&C Insurance North America Agricultural Insurance Overseas General Insurance Global Reinsurance Corporate Total P&C

Nine Months Ended

September 30, 2022

March 31, 2023

(in millions of U.S.

dollars except for ratios)

Losses and loss expenses A $ 7,979 $ 2,343 $ 1,830 $ 4,054 $ 565 $ 275 $ 17,046

Losses and loss expenses/policy benefits A $ 2,729 $ 888 $ 140 $ 1,347 $ 112 $ 11 $ 5,227

Catastrophe losses and related adjustments

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PPD, net of related adjustments - favorable (unfavorable) 72 (17) — 143 8 (10) 196

Net premiums earned adjustments on PPD - unfavorable (favorable) 83 — 159 — — — 242

Expense adjustments - unfavorable (favorable) 3 — — — — — 3

7 unchanged sentences

Net premiums earned E $ 4,369 $ 1,320 $ 159 $ 2,786 $ 244 $ 8,878

Reinstatement premiums (collected) expensed on catastrophe losses — — — — (55) (55)

Net premiums earned adjustments on PPD - unfavorable (favorable) 83 — 159 — — 242

PPD reinstatement premiums - unfavorable (favorable) — (1) — — — (1)

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North America Commercial P&C Insurance North America Personal P&C Insurance North America Agricultural Insurance Overseas General Insurance Global Reinsurance Corporate Total P&C

Nine Months Ended

September 30, 2021

Three Months Ended

March 31, 2022

(in millions of U.S.

dollars except for ratios)

Losses and loss expenses A $ 7,740 $ 2,341 $ 1,554 $ 3,936 $ 422 $ 141 $ 16,134

Losses and loss expenses/policy benefits A $ 2,497 $ 713 $ (92) $ 1,389 $ 115 $ 10 $ 4,632

Catastrophe losses and related adjustments

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Net premiums earned E $ 4,114 $ 1,247 $ (29) $ 2,628 $ 235 $ 8,195

Reinstatement premiums (collected) expensed on catastrophe losses — 16 — — (18) (2)

Net premiums earned adjustments on PPD - unfavorable (favorable) — — 159 — — 159

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Amortization of Purchased Intangibles and Other Amortization

Amortization expense related to purchased intangibles was $69 million and $211 million for the three and nine months ended September 30, 2022, respectively, compared with $71 million and $216 million for the prior year periods, respectively.

The respective increases principally relate to purchased intangibles from the acquisition of Cigna's business in Asia.

Refer to Note 7 to the Consolidated Financial Statements for more information on the expected pre-tax amortization expense (benefit) of purchased intangibles, at current foreign currency exchange rates, for the fourth quarter of 2022 and for the next five years.

Reduction of deferred tax liability associated with Other intangible assets

At September 30, 2022, the deferred tax liability associated with Other intangible assets (excluding the fair value adjustment on Unpaid losses and loss expense) was $1,206 million.

The following table presents, as of September 30, 2022, the expected reduction to the deferred tax liability associated with the amortization of Other intangible assets, at current foreign exchange rates, for the fourth quarter of 2022 and for the next five years:

Amortization of purchased intangibles

Amortization expense related to purchased intangibles was $72 million and $71 million for the three months ended March 31, 2023 and 2022, respectively.

At March 31, 2023, the deferred tax liability associated with the Other intangible assets (excluding the fair value adjustment on Unpaid losses and loss expense) was $1,206 million.

The following table presents, as of March 31, 2023, the expected reduction to the deferred tax liability associated with the amortization of Other intangible assets, at current foreign currency exchange rates, for the second through fourth quarters of 2023 and for the next five years:

For the Years Ending December 31

(in millions of U.S.

dollars) Reduction to deferred tax liability associated with other intangibles

dollars) Reduction to deferred tax liability associated with intangible assets

Second quarter of 2023 $ 16

Third quarter of 2023 16

Fourth quarter of 2023 16

Amortization of the fair value adjustment on acquired invested assets and assumed long-term debt

The following table presents, as of September 30, 2022, the expected amortization expense of the fair value adjustment on acquired invested assets related to the acquisition of Cigna's business in Asia and prior acquisitions, at current foreign currency exchange rates, and the expected amortization benefit from the fair value adjustment on assumed long-term debt related to the Chubb Corp acquisition for the fourth quarter of 2022 and for the next five years:

The following table presents, as of March 31, 2023, the expected amortization expense of the fair value adjustment on acquired invested assets related to the acquisitions of Cigna's business in Asia and Chubb Corp, at current foreign currency exchange rates, and the expected amortization benefit from the fair value adjustment on assumed long-term debt related to the Chubb Corp acquisition for the second through fourth quarters of 2023 and for the next five years:

Amortization (expense) benefit of the fair value adjustment on

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(in millions of U.S.

dollars) Acquired Cigna invested assets Other acquired invested assets Total invested assets (1)

dollars) Acquired Cigna invested assets Acquired Chubb Corp invested assets Total acquired invested assets (1)

Assumed long-term debt (2)

Second quarter of 2023 $ 6 $ (9) $ (3) $ 5

Third quarter of 2023 6 (8) (2) 5

Fourth quarter of 2023 5 (8) (3) 6

10 unchanged sentences

Three Months Ended

September 30 Nine Months Ended

(in millions of U.S.

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Gross investment income (1)

1,024 912 2,825 2,753

Investment expenses (45) (46)

2 unchanged sentences

(1) Includes amortization expense related to fair value adjustment of acquired invested assets

related to the Chubb Corp acquisition

$ (6) $ (19) $ (36) $ (67)

Net investment income is influenced by a number of factors including the amounts and timing of inward and outward cash flows, the level of interest rates, and changes in overall asset allocation.

Net investment income increased 13.1 percent and 2.9 percent for the three and nine months ended September 30, 2022, respectively, primarily due to higher reinvestment rates on fixed maturities.

Net investment income increased 34.7 percent for the three months ended March 31, 2023, primarily due to higher reinvestment rates on fixed maturities.

For private equities where we own less than three percent, investment income is included within Net investment income in the table above.

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Three Months Ended

September 30 Nine Months Ended

(in millions of U.S.

dollars) 2023 2022

Total mark-to-market gain (loss) on private equity, pre-tax $ (232) $ 713 $ (52) $ 1,887

Our investment portfolio is invested primarily in publicly traded, investment grade, fixed income securities with an average credit quality of A/A as rated by the independent investment rating services Standard and Poor’s (S&P)/Moody’s Investors Service (Moody’s) at September 30, 2022.

Total mark-to-market gain on private equity, pre-tax $ 257 $ 310

Interest Expense

Interest expense for the three months ended March 31, 2023, comprised $165 million related to fixed expenses on existing debt obligations and variable expenses, and a $5 million benefit related to the amortization of the fair value of debt assumed in the Chubb Corp acquisition.

The variable expenses relate to fees from the usage of certain facilities, including letters of credit, and interest on held collateral and repurchase agreements.

Interest expense for the first quarter of 2023 was higher than expected primarily due to rising interest rates on held collateral.

Based on our existing fixed debt obligations and projected variable expenses, we now expect pre-tax interest expense on these items to be approximately $495 million for the remainder of 2023, or $165 million each quarter.

For more information on our debt obligations, refer to Note 9 to the Consolidated Financial Statements, under Item 8 in our 2022 Form 10-K.

The portfolio is externally managed by independent, professional investment managers and is broadly diversified across geographies, sectors, and issuers.

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We also have well-established, strict contractual investment rules requiring managers to maintain highly diversified exposures to individual issuers and clos ely monitor investment manager compliance with portfolio guidelines.

The average duration of our fixed income securities, including the effect of options and swaps, was 4.5 years and 4.1 years at September 30, 2022 and December 31, 2021, respectively.

We estimate that a 100 basis point (bps) increase in interest rates would reduce the valuation of our fixed income portfolio by approximately $4.4 billion at September 30, 2022.

The average duration of our fixed income securities, including the effect of options and swaps, was 4.7 years and 4.5 years at March 31, 2023, and December 31, 2022, respectively.

We estimate that a 100 basis point (bps) increase in interest rates would reduce the valuation of our fixed income portfolio by approximately $4.7 billion at March 31, 2023.

The following table shows the fair value and cost/amortized cost, net of valuation allowance, of our invested assets:

September 30, 2022 December 31, 2021

March 31, 2023 December 31, 2022

(in millions of U.S.

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Total investments $ 115,300 $ 121,795 $ 113,142 $ 121,519

The fair value of our total investments decreased $11.6 billion during the nine months ended September 30, 2022 due to unrealized losses on fixed maturities, sales of equity securities , and sh are repurchases, partially offset by strong operating cash flows.

The following tables present the fair value of our fixed income securities at September 30, 2022 and December 31, 2021.

The fair value of our total investments increased $2.2 billion during the three months ended March 31, 2023, primarily due to the investing of operating cash flow and unrealized gains on fixed maturities due to decreasing interest rates.

This increase was partially offset by the payment of our $475 million 2.7 percent senior notes due March 2023 and share repurchases.

The following tables present the fair value of our fixed income securities at March 31, 2023, and December 31, 2022.

The first table lists investments according to type and second according to S&P credit rating:

September 30, 2022 December 31, 2021

March 31, 2023 December 31, 2022

(in millions of U.S.

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Corporate and asset-backed securities

The following table presents our 10 largest global exposures to corporate bonds by fair value at September 30, 2022:

The following table presents our 10 largest global exposures to corporate bonds by fair value at March 31, 2023:

(in millions of U.S.

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Bank of America Corp $ 763

JP Morgan Chase & Co 590

Morgan Stanley 688

JP Morgan Chase & Co 672

Wells Fargo & Co 594

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Verizon Communications Inc 382

Comcast Corp 353

HSBC Holdings Plc 367

Comcast Corp 355

Anheuser-Busch InBev SA/NV 328

Mortgage-backed securities

2 unchanged sentences

Value Amortized Cost, Net

September 30, 2022

March 31, 2023

(in millions of U.S.

22 unchanged sentences

fixed income portfolio by country/sovereign for non-U.S.

government securities at September 30, 2022:

government securities at March 31, 2023:

(in millions of U.S.

1 unchanged sentence

Republic of Korea $ 1,700 $ 1,697

Canada 864 925

Taiwan 943 919

Federative Republic of Brazil 581 598

Canada 925 963

Province of Ontario 593 620

United Mexican States 549 582

Federative Republic of Brazil 537 546

Kingdom of Thailand 536 508

Province of Quebec 377 401

Commonwealth of Australia 479 523

Socialist Republic of Vietnam 439 360

United Kingdom 398 433

Other Non-U.S.

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fixed income portfolio by country/sovereign for non-U.S.

corporate securities at September 30, 2022:

corporate securities at March 31, 2023:

(in millions of U.S.

3 unchanged sentences

South Korea 1,321 1,333

France 1,060 1,179

United States (1)

France 1,167 1,255

Australia 976 1,046

Japan 741 787

Switzerland 496 571

Netherlands 536 572

Germany 510 560

Switzerland 470 522

Other Non-U.S.

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Also, issuers of below-investment grade securities usually have higher levels of debt and are more sensitive to adverse economic conditions, such as recession or increasing interest rates, than investment grade issuers.

At September 30, 2022, our corporate fixed income investment portfolio included below-investment grade and non-rated securities which, in total, comprised approximately 16 percent of our fixed income portfolio.

Our below-investment grade and non-rated portfolio includes 1,763 issuers, with the greatest single exposure being $146 million.

At March 31, 2023, our corporate fixed income investment portfolio included below-investment grade and non-rated securities which, in total, comprised approximately 16 percent of our fixed income portfolio.

Our below-investment grade and non-rated portfolio includes over 1,700 issuers, with the greatest single exposure being $156 million.

We manage high-yield bonds as a distinct and separate asset class from investment grade bonds.

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Critical Accounting Estimates

As of September 30, 2022, there were no material changes to our critical accounting estimates.

For a full discussion of our critical accounting estimates, refer to Item 7 in our 2021 Form 10-K.

Unpaid losses and loss expenses

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Other (including foreign exchange translation) (321) (125) (196)

Balance at September 30, 2022 $ 75,992 $ 17,380 $ 58,612

Balance at March 31, 2023 $ 75,417 $ 16,520 $ 58,897

(1) Net of valuation allowance for uncollectible reinsurance.

3 unchanged sentences

Refer to Note 8 to the Consolidated Financial Statements for a discussion on the changes in the loss reserves.

Future policy benefits

Effective January 1, 2023, Chubb adopted the long-duration targeted improvement (LDTI) U.S.

GAAP accounting guidance which affects the recognition, measurement, presentation, and disclosure requirements for long-duration contracts.

For a discussion of our critical accounting estimates, refer to Item 7 in our 2022 Form 10-K.

Asbestos and Environmental (A&E)

During the three months ended September 30, 2022, we increased environmental net loss reserves for Brandywine managed operations by $52 million.

There was no significant A&E reserve activity during the three months ended March 31, 2023.

A&E reserves are included in Corporate.

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Chubb uses internal and external data together with sophisticated, analytical catastrophe loss and risk modeling techniques to ensure an appropriate understanding of risk, including diversification and correlation effects, across different product lines and territories.

The table below presents our modeled pre-tax estimates of natural catastrophe PML, net of reinsurance, at September 30, 2022, and does not represent our expected catastrophe losses for any one year.

The table below presents our modeled pre-tax estimates of natural catastrophe PML, net of reinsurance, at March 31, 2023, and does not represent our expected catastrophe losses for any one year.

Modeled Net Probable Maximum Loss (PML) Pre-tax

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1-in-250 $ 8,557 16.1 % $ 6,493 12.3 % $ 1,638 3.1 %

(1) Worldwide aggregate is comprised of losses arising from tropical cyclones, convective storms, earthquakes, and U.S.

wildfires and inland floods, and excludes "non-modeled" perils such as man-made and other catastrophe risks including pandemic.

hurricane losses include losses from wind and storm-surge and exclude rainfall.

(1) Worldwide aggregate is comprised of losses arising from tropical cyclones, convective storms, earthquakes, U.S.

wildfires, and floods in the U.S., Canada, and Europe, and excludes "non-modeled" perils such as man-made and other catastrophe risks including pandemic.

hurricane losses include losses from wind, storm-surge, and related precipitation-induced flooding.

(3) California earthquakes include the fire-following sub-peril.

The PML for worldwide and key U.S.

peril regions are based on our in-force portfolio at July 1, 2022, and reflect the April 1, 2022, reinsurance program (see Global Property Catastrophe Reinsurance Program section) as well as inuring reinsurance protection coverages.

peril regions are based on our in-force portfolio at January 1, 2023, and reflect the April 1, 2023, reinsurance program (see Global Property Catastrophe Reinsurance Program section) as well as inuring reinsurance protection coverages.

These estimates assume that reinsurance recoverable is fully collectible.

According to the model, for the 1-in-100 return period scenario, there is a one percent chance that our pre-tax annual aggregate losses incurred in any year from U.S.

hurricane events could be in excess of $2,869 million (or 6.0 percent of our total shareholders’ equity at September 30, 2022).

Effective December 31, 2021, our worldwide PMLs include losses from U.S.

wildfire and U.S.

inland flood.

hurricane events could be in excess of $3,441 million (or 6.5 percent of our total shareholders’ equity at March 31, 2023).

Effective December 31, 2022, our worldwide PMLs include losses from floods in Canada and Europe.

Additionally, U.S.

hurricane PMLs include losses from hurricane related precipitation-induced flooding.

The above estimates of Chubb’s loss profile are inherently uncertain for many reasons, including the following:

• While the use of third-party modeling packages to simulate potential catastrophe losses is prevalent within the insurance industry, the models are reliant upon significant meteorology, seismology, and engineering assumptions to estimate catastrophe losses.

Modeled catastrophe events are not always a representation of actual events and ensuing additional loss potential;

In particular, modeled catastrophe events are not always a representation of actual events and ensuing additional loss potential;

• There is no universal standard in the preparation of insured data for use in the models, the running of the modeling software, and interpretation of loss output.

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(including Alaska and Hawaii) $200 million –

$1.275 billion

All natural perils and terrorism (c)

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Capital resources consist of funds deployed or available to be deployed to support our business operations.

September 30 December 31

March 31 December 31

(in millions of U.S.

dollars, except for ratios) 2022 2021

dollars, except for ratios) As Adjusted

Short-term debt $ — $ 475

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Ratio of financial debt plus trust preferred securities to total capitalization 21.7 % 23.1 %

The ratios of financial debt to total capitalization in the table above are higher at September 30, 2022 compared to December 31, 2021 from the decline in shareholders' equity, principally reflecting net unrealized depreciation on investments in the current period compared to net unrealized appreciation in 2021.

Repurchase agreements are excluded from the table above and are disclosed separately from short-term debt in the Consolidated balance sheets.

The repurchase agreements are collateralized borrowings where we maintain the right and ability to redeem the collateral on short notice, unlike short-term debt which comprises the current maturities of our long-term debt instruments.

For the nine months ended September 30, 2022, we repurchased $2.8 billion of Common Shares in a series of open market transactions under the Board of Directors (Board) share repurchase authorization.

At September 30, 2022, there were 31,356,130 Common Shares in treasury with a weighted-average cost of $158.76 per share, and $1.8 billion in share repurchase authorization remained through June 30, 2023.

For the three months ended March 31, 2023, we repurchased $428 million of Common Shares in a series of open market transactions under the Board of Directors (Board) share repurchase authorization.

At March 31, 2023, there were 32,217,934 Common Shares in treasury with a weighted-average cost of $165.77 per share, and $1.2 billion in share repurchase authorization remained through June 30, 2023.

For the period April 1, 2023, through May 1, 2023, we repurchased 215,400 Common Shares for a total of $43 million in a series of open market transactions under the share repurchase authorization.

At May 1, 2023, $1.2 billion in share repurchase authorization remained.

We generally maintain the ability to issue certain classes of debt and equity securities via a Securities and Exchange Commission (SEC) shelf registration statement which is renewed every three years.

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The Board determines the record and payment dates at which the annual dividend may be paid until the date of the 2023 annual general meeting, and is authorized to abstain from distributing a dividend at its discretion.

The four quarterly installments each of $0.83 per share were distributed by the Board as expected.

The annual dividend approved in May 2022 represented a $0.12 per share increase ($0.03 per quarter) over the prior year dividend.

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March 17, 2023 April 10, 2023 $0.83 (CHF 0.77)

June 17, 2022 July 8, 2022 $0.83 (CHF 0.80)

September 16, 2022

October 7, 2022

$0.83 (CHF 0.78)

We anticipate that positive cash flows from operations (underwriting activities and investment income) should be sufficient to cover cash outflows under most loss scenarios for the near term.

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The programs allow us to optimize investment income by avoiding portfolio disruption.

Should the need arise, we generally have access to capital markets and to credit facilities with letter of credit capacity of $3.7 billion with a sub-limit of $2.0 billion for revolving credit.

At September 30, 2022, our usage under these facilities was $1.4 billion in letters of credit.

Should the need arise, we generally have access to capital markets and to credit facilities with letter of credit capacity of $4.0 billion, $3.0 billion of which can be used for revolving credit.

At March 31, 2023, our usage under these facilities was $1.4 billion in letters of credit.

Our access to credit under these facilities is dependent on the ability of the banks that are a party to the facilities to meet their funding commitments.

The facilities require that we maintain certain financial covenants, all of which we met at September 30, 2022.

The facilities require that we maintain certain financial covenants, all of which we met at March 31, 2023.

Should the existing credit providers on these facilities experience financial difficulty, we may be required to replace credit sources, possibly in a difficult market.

If we cannot obtain adequate capital or sources of credit on favorable terms, on a timely basis, or at all, our business, operating results, and financial condition could be adversely affected.

To date, we have not experienced difficulty accessing our credit facilities.

In October 2022, Chubb entered into a new group syndicated credit facility through 2027 with capacity of $3.0 billion.

This facility consolidated our three existing syndicated facilities with capacity of $2.7 billion.

To date, we have not experienced difficulty accessing our credit facility or establishing additional facilities when needed.

The payment of dividends or other statutorily permissible distributions from our operating companies are subject to the laws and regulations applicable to each jurisdiction, as well as the need to maintain capital levels adequate to support the insurance and reinsurance operations, including financial strength ratings issued by independent rating agencies.

During the nine months ended September 30, 2022, we were able to meet all our obligations, including the payments of dividends on our Common Shares, with our net cash flows.

During the three months ended March 31, 2023, we were able to meet all our obligations, including the payments of dividends on our Common Shares, with our net cash flows.

We assess which subsidiaries to draw dividends from based on a number of factors.

Considerations such as regulatory and legal restrictions as well as the subsidiary’s financial condition are paramount to the dividend decision.

Chubb Limited received dividends of $6.8 billion and $3.1 billion from its Bermuda subsidiaries during the nine months ended September 30, 2022 and 2021, respectively.

Chubb Limited received cash dividends of $32 million and $21 million and non-cash dividends of $348 million and $536 million from a Swiss subsidiary during the nine months ended September 30, 2022 and 2021, respectively.

Chubb Limited received dividends of $225 million and $1.0 billion from its Bermuda subsidiaries during the three months ended March 31, 2023 and 2022, respectively.

insurance subsidiaries of Chubb INA Holdings Inc.

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These laws and regulations sometimes include restrictions that limit the amount of dividends payable without prior approval of regulatory insurance authorities.

Chubb Limited received no dividends from Chubb INA during the nine months ended September 30, 2022 and 2021.

Chubb Limited received no dividends from Chubb INA during the three months ended March 31, 2023 and 2022.

Debt issued by Chubb INA is serviced by statutorily permissible distributions by Chubb INA’s insurance subsidiaries to Chubb INA as well as other group resources.

Chubb INA received $1.8 billion and $910 million from its subsidiaries during the nine months ended September 30, 2022 and 2021, respectively.

Chubb INA received no dividends from its subsidiaries during the three months ended March 31, 2023 and 2022.

Our sources of liquidity include cash from operations, routine sales of investments, and financing arrangements.

The following is a discussion of our cash flows for the nine months ended September 30, 2022 and 2021.

Operating cash flows were $8.6 billion in the nine months ended September 30, 2022, compared to $8.5 billion in the prior year period.

Cash used for investing was $5.2 billion in the nine months ended September 30, 2022, compared to $3.8 billion in the prior year period.

Cash used for investing in the current year was primarily due to cash paid for the purchase of Cigna's business in Asia of $5.0 billion, which is net of cash acquired of $366 million.

There were net sales, principally in equities securities and fixed maturities of $1.9 billion, in part to fund the acquisition of Cigna's business in Asia, compared to net purchases of $2.3 billion in the prior year.

In addition, the current year included higher private equity contributions, net of distributions received, of $1.5 billion compared to $981 million in the prior year.

Cash used for financing was $2.7 billion in the nine months ended September 30, 2022, compared to $4.8 billion in the prior year period.

This decrease of $2.1 billion reflects lower Common Shares repurchased of $1.2 billion and proceeds of $1.0 billion from repurchase agreements, which were used to finance a portion of the acquisition of Cigna's business in Asia.

At September 30, 2022, there were $2.4 billion in repurchase agreements outstanding with various maturities over the next four months.

The following is a discussion of our cash flows for the three months ended March 31, 2023 and 2022.

Operating cash flows were $2.3 billion in the three months ended March 31, 2023, compared to $2.4 billion in the prior year period.

Cash used for investing was $570 million in the three months ended March 31, 2023, compared to $995 million in the prior year period, a decrease of $425 million.

Cash used for investing in the current period included lower private equity contributions, net of distributions received, of $351 million and lower net purchases of equity securities and fixed maturities of $148 million.

Cash used for financing was $1.4 billion in the three months ended March 31, 2023, compared to $1.3 billion in the prior year period.

The increase of $108 million is from the repayment of long-term debt of $475 million in the current year, partially offset by fewer common shares repurchased of $456 million.

We use repurchase agreements as a low-cost alternative.

At March 31, 2023, there were $1.4 billion in repurchase agreements outstanding with various maturities over the next two months.

Both internal and external forces influence our financial condition, results of operations, and cash flows.

Claim settlements, premium levels, and investment returns may be impacted by changing rates of inflation and other economic conditions.

In many cases, significant periods of time, ranging up to several years or more, may lapse between the occurrence of an insured loss, the reporting of the loss to us, and the settlement of the liability for that loss.

cases, significant periods of time, ranging up to several years or more, may lapse between the occurrence of an insured loss, the reporting of the loss to us, and the settlement of the liability for that loss.

Information provided in connection with outstanding debt of subsidiaries

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(Subsidiary Issuer)

September 30 December 31 September 30 December 31

March 31 December 31 March 31 December 31

(in millions of U.S.

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The following table presents the condensed statements of operations and comprehensive income of Chubb Limited and Chubb INA Holdings Inc., excluding equity in earnings from non-guarantor subsidiaries:

Nine Months Ended September 30, 2022 Chubb Limited

Three Months Ended March 31, 2023 Chubb Limited

(Parent Guarantor) Chubb INA Holdings Inc.

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Other (income) expense (11) 28

Cigna integration expenses 10 —

Income tax expense (benefit) 2 (49)

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis