What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2023-11-01 compared with 2023-07-28 · 344 added, 298 removed, 981 unchanged (40% 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 six months ended June 30, 2023.

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, 2023.

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

18 unchanged sentences

Net Investment Income

Interest Expense

Critical Accounting Estimates

51 unchanged sentences

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 June 30, 2023, we had total assets of $205 billion and shareholders’ equity of $53 billion.

At September 30, 2023, we had total assets of $223 billion and total Chubb shareholders’ equity, which excludes noncontrolling interests, of $52.4 billion.

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

2 unchanged sentences

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

Consolidated Operating Results – Three and Six Months Ended June 30, 2023 and 2022

Three Months Ended Six Months Ended

June 30 % Change June 30 % Change

On July 1, 2023, we completed the acquisition of a controlling majority interest of Huatai Group.

For the three and nine months ended September 30, 2023, the results of operations of Huatai Group is reported at 100 percent in our consolidated results starting from the acquisition date, with amounts attributable to shareholders other than Chubb are reflected under Noncontrolling interests.

Huatai Group's life and asset management businesses are included in the Life Insurance segment, and Huatai Group's P&C business is included in the Overseas General Insurance segment.

Results for Huatai Group's non-insurance operations, comprising real estate and holding company activity, are included in Corporate.

Consolidated Operating Results – Three and Nine Months Ended September 30, 2023 and 2022

Three Months Ended Nine Months Ended

September 30 % Change September 30 % Change

(in millions of U.S.

3 unchanged sentences

Net premiums written - constant dollars (1)

16.8 % 17.5 %

Net premiums earned 12,674 11,530 9.9 % 33,815 29,816 13.4 %

1 unchanged sentence

Net realized gains (losses) (103) (456) (77.3) % (484) (936) (48.1) %

Market risk benefits gains (losses) (7) (33) (79.9) % (122) 16 NM

Market risk benefits gains (losses) (32) 69 NM (154) 85 NM

Total revenues 13,853 12,122 14.3 % 36,743 31,654 16.1 %

4 unchanged sentences

Interest expense 174 150 15.6 % 499 416 19.8 %

Other (income) expense (100) 101 NM (396) (211) 88.1 %

Other (income) expense (154) 202 NM (550) (9) NM

Amortization of purchased intangibles 84 69 22.0 % 226 211 7.1 %

Cigna integration expenses 15 3 NM 37 3 NM

Cigna integration expenses 14 23 (38.8) % 51 26 99.4 %

Total expenses 11,400 11,067 3.0 % 29,829 26,812 11.2 %

2 unchanged sentences

Net income $ 2,040 $ 792 157.0 % $ 5,725 $ 3,935 45.4 %

Net loss attributable to noncontrolling interests (3) — NM (3) — NM

Net income attributable to Chubb $ 2,043 $ 792 157.8 % $ 5,728 $ 3,935 45.5 %

NM - not meaningful

1 unchanged sentence

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 June 30, 2023

• Net income was $1.8 billion compared with $1.2 billion in the prior year period.

Financial Highlights for the Three Months Ended September 30, 2023

• On July 1, 2023, Chubb increased its investment in Huatai Group from approximately 64.2 percent to approximately 69.6 percent, discontinued the equity method of accounting and applied consolidation accounting.

Business activity for, and the financial position of, Huatai Group is reported at 100 percent on the Consolidated Financial Statements.

The relevant amounts attributable to investors other than Chubb are reflected under Noncontrolling interests, Net income (loss) attributable to noncontrolling interests, and Comprehensive income (loss) attributable to noncontrolling interests on the Consolidated Financial Statements.

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

• Net income attributable to Chubb was $2.0 billion compared with $792 million in the prior year period.

Net income in the current quarter was driven by strong underwriting results, including growth in net premiums earned, and record net investment income.

The acquisition of Cigna's Asian business in 2022 added to net income.

In addition, there were after-tax mark-to-market gains on public and private equities of $52 million in the current quarter compared to losses of $489 million in the prior year.

There were after-tax mark-to-market gains on public and private equities of $46 million in the current quarter compared to losses of $287 million in the prior year.

In addition, there were after-tax realized losses on fixed maturities of $37 million, compared to $393 million in the prior year.

• Consolidated net premiums written were $13.1 billion, up 9.1 percent, or 8.4 percent in constant dollars.

P&C net premiums written were up 9.8 percent, or 10.4 percent in constant dollars, with commercial and consumer lines up 10.4 percent and 10.5 percent, respectively.

Life net premiums written up were up 126.1 percent, or 127.6 percent in constant dollars, driven substantially by the acquisition of Cigna's Asian business.

P&C net premiums written increased 8.4 percent, or 7.6 percent in constant dollars, with commercial lines and consumer lines up 5.4 percent and 14.9 percent, respectively.

Life Insurance segment net premiums written increased 14.9 percent.

The consolidation of Huatai Group added 2.9 percentage points, 1.8 percentage points, and 11.9 percentage points to consolidated, P&C, and Life Insurance net premiums written growth, respectively.

• Consolidated net premiums earned were $12.7 billion, up 9.9 percent, or 9.0 percent in constant dollars.

P&C net premiums earned increased 8.1 percent, or 8.7 percent in constant dollars, with commercial and consumer lines up 9.1 percent and 7.7 percent, respectively.

• Total pre-tax and after-tax catastrophe losses were $400 million (4.1 percentage points of the P&C combined ratio) and $319 million, respectively, compared with $291 million (3.2 percentage points of the P&C combined ratio) and $241 million, respectively, in the prior year period.

Catastrophe losses in the current quarter comprise 25 individual events, primarily in North America.

The consolidation of Huatai Group added 3.3 percentage points to the growth in net premiums earned.

• Total pre-tax and after-tax catastrophe losses were $670 million (6.0 percentage points of the P&C combined ratio) and $544 million, respectively, compared with $1.2 billion (11.3 percentage points of the P&C combined ratio) and $949 million, respectively, in the prior year period.

• Total pre-tax and after-tax favorable prior period development were $200 million (1.9 percentage points of the P&C combined ratio) and $116 million, respectively.

1 unchanged sentence

• The P&C combined ratio was 88.4 percent compared with 93.1 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 current year P&C combined ratio decreased primarily due to lower catastrophe losses, partially offset by lower favorable prior period development.

The P&C current accident year (CAY) combined ratio excluding catastrophe losses was 84.3 percent compared with 84.0 percent in the prior year period.

• Net investment income was a record $1.1 billion compared with $888 million in the prior year period, primarily reflecting higher reinvestment rates.

• Operating cash flow was $2.5 billion compared with $2.7 billion in the prior year period.

• Shareholders' equity remained essentially flat in the quarter, as net income of $1.8 billion and cumulative translation gains of $216 million were partially offset by net unrealized losses on investments of $1.2 billion from higher interest rates.

In addition, shareholders' equity reflects total capital returned to shareholders in the quarter of $1.1 billion, including share repurchases of $724 million, at an average purchase price of $197.04 per share, and dividends of $354 million.

• Net investment income was a record $1.3 billion compared with $979 million in the prior year period, primarily reflecting higher reinvestment rates and the consolidation of Huatai Group.

• Operating cash flow was a record $4.7 billion compared with $3.4 billion in the prior year period.

• Chubb shareholders' equity decreased 1.0 percent in the quarter, as net income attributable to Chubb was more than offset by net unrealized losses and total capital returned to shareholders of $1.0 billion.

Shareholders' equity also includes a one-time net realized and unrealized gain of $727 million, principally reflecting the discontinuation of the equity method of accounting upon the consolidation of Huatai.

Total capital returned to shareholders comprises share repurchases of $606 million, at an average purchase price of $205.44 per share, and dividends of $352 million.

We previously announced that our Board of Directors approved a new share repurchase program of up to $5 billion with no expiration date, effective July 1, 2023.

3 unchanged sentences

The impact to 2022 results was immaterial.

• On July 1, 2023 we closed on an additional 5.4% ownership interests in Huatai Group, a Chinese financial services holding company, that brings our total aggregate ownership to approximately 69.6%.

We will apply consolidation accounting to our Huatai Group investment effective in the third quarter of 2023.

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

Net Premiums Written Three Months Ended

June 30 % Change Six Months Ended

% Change Nine Months Ended

(in millions of U.S.

17 unchanged sentences

Total Property and Casualty lines 11,652 10,747 8.4 % 7.6 % 31,750 29,091 9.1 % 9.5 %

Global A&H - Life 811 244 233.3 % 237.3 % 1,620 500 224.1 % 227.9 %

Life 459 318 44.1 % 44.4 % 943 638 47.8 % 49.8 %

Life Insurance 1,452 1,265 14.9 % 15.2 % 4,015 2,403 67.1 % 68.4 %

1 unchanged sentence

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

The increase in consolidated net premiums written for the three and six months ended June 30, 2023, reflects growth across most product lines driven by strong premium retention, including rate and exposure increases, and strong new business.

In addition, growth for the three and six months ended June 30, 2023 includes the results of Cigna's business acquired during the third quarter of 2022.

The increase in consolidated net premiums written for the three and nine months ended September 30, 2023, reflects growth across most product lines driven by strong premium retention, including rate and exposure increases, and strong new business.

The consolidation of Huatai Group contributed $365 million, or 2.9 percentage points and 1.1 percentage points, for the three and nine months ended September 30, 2023, respectively.

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

• Workers' compensation decreased in the quarter from lower new business in North America.

• Financial lines decreased, reflecting lower renewal business in North America.

• Workers' compensation growth reflects increased audit exposure in North America.

• 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, principally from our fall-seeded crops, and strong new business in Chubb Agribusiness.

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

• Agriculture decreased in the quarter mainly due to the timing of premium recognition this year versus last year, and a modest increase in the premium the company shared with the Federal Government.

Growth for the year reflects the above factors and the prior year return of premium to the U.S.

government of $161 million.

• Personal lines grew principally in North America and Europe, with growth strongest in homeowners.

• Global A&H – P&C increased due to growth in Asia, primarily due to the acquisition of Cigna’s business in 2022, and higher new business and increased consumer activity, including higher travel volume, in Europe, Latin America, and Japan.

• Reinsurance lines increased reflecting new business and rate increases in property, partially offset by lower catastrophe reinstatement premiums.

• Global A&H – Life increased due to the acquisition of Cigna’s business in Asia.

Growth in our North American Combined Insurance supplemental A&H business was more than offset by the non-renewal of a large program.

• Life increased primarily due to the acquisition of Cigna's business in Asia.

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

• Global A&H – P&C increased primarily due to 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 decreased in the quarter, as continued growth in the portfolio, primarily in property lines, was more than offset by the impact of catastrophe reinstatement premiums recognized in the prior year.

Growth for the year reflects continued growth in the portfolio, primarily in property lines, partially offset by the impact of catastrophe reinstatement premiums recognized in the prior year.

• Life increased primarily due to the consolidation of Huatai Group in the third quarter of 2023, which contributed $149 million or 11.9 percentage points.

Growth for the year is primarily due to the acquisition of Cigna's business in Asia, and growth in Latin America and Asia.

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

2 unchanged sentences

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 June 30, 2023, net premiums earned increased $1.5 billion, up 15.2 percent, or 15.8 percent in constant dollars.

For the three months ended September 30, 2023, net premiums earned increased $1.1 billion, up 9.9 percent, or 9.0 percent in constant dollars.

P&C net premiums earned increased 9.2 percent, or 8.1 percent in constant dollars, comprising growth in commercial and consumer lines of 6.9 percent and 11.9 percent, respectively.

For the six months ended June 30, 2023, net premiums earned increased $2.9 billion, up 15.6 percent, or 16.7 percent in constant dollars.

For the nine months ended September 30, 2023, net premiums earned increased $4.0 billion, up 13.4 percent, or 13.7 percent in constant dollars.

P&C net premiums earned increased 8.6 percent, or 8.8 percent in constant dollars, comprising growth in commercial and consumer lines of 8.7 percent and 9.3 percent, respectively.

8 unchanged sentences

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 Six Months Ended

June 30 June 30

Three Months Ended Nine Months Ended

September 30 September 30

(in millions of U.S.

2 unchanged sentences

Favorable prior period development $ 200 $ 222 $ 596 $ 709

Catastrophe losses through June 30, 2023 and 2022, were primarily from the following events:

Severe weather-related events in the U.S.

and internationally;

and New Zealand storms.

Catastrophe losses through September 30, 2023 and 2022, were primarily from the following events:

Severe weather-related events in the U.S.

and internationally, Hawaii wildfires, and New Zealand storms.

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

and internationally, Australia storms, and Colorado wildfires.

Pre-tax net favorable PPD for the three months ended June 30, 2023, was $200 million, including adverse development of $49 million for molestation claims.

Pre-tax net favorable PPD for the six months ended June 30, 2023, was $396 million, including adverse development of $49 million for molestation claims.

Excluding the adverse development, we had net favorable development of $445 million with 23 percent in long-tail lines, principally from accident years 2011 through 2019, and 77 percent in short-tail lines, primarily in A&H and surety lines.

Pre-tax net favorable PPD for the three months ended June 30, 2022, was $247 million, including adverse development of $155 million for molestation claims, predominantly reviver statute-related.

Excluding the adverse development, we had favorable development of $402 million, with 59 percent in long-tail lines, principally from accident years 2017 and prior, and 41 percent in short-tail lines, primarily in A&H, specialty, and automobile lines.

Pre-tax net favorable PPD for the six months ended June 30, 2022, was $487 million, including adverse development of $155 million for molestation claims described above, predominantly reviver statute-related.

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

Excluding the adverse

development, we had favorable development of $642 million with 39 percent in long-tail lines, principally from accident years 2017 and prior, and 61 percent in short-tail lines, primarily in A&H, property, and specialty lines.

Pre-tax net favorable PPD for the three months ended September 30, 2023, was $200 million, including adverse development of $116 million in long-tail lines, with $50 million related to legacy environmental exposures.

Net favorable development of $316 million in short-tail lines is primarily in property lines.

Pre-tax net favorable PPD for the nine months ended September 30, 2023, was $596 million, including adverse development of $50 million related to legacy environmental exposures and $49 million for molestation claims.

Excluding the adverse development, we had net favorable development of $695 million with 5 percent in long-tail lines, principally from accident years 2013 through 2019, and 95 percent in short-tail lines, primarily in property, A&H, and surety lines.

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.

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

4 unchanged sentences

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

Three Months Ended Six Months Ended

June 30 June 30

Three Months Ended Nine Months Ended

September 30 September 30

2023 2022 2023 2022

7 unchanged sentences

P&C Combined ratio 88.4 % 93.1 % 86.8 % 87.5 %

The loss and loss expense ratio increased for the three and six months ended June 30, 2023, reflecting higher catastrophe losses and lower favorable prior period development.

The CAY loss ratio excluding catastrophe losses decreased for the three and six months ended June 30, 2023, primarily from a higher percentage of net premiums earned from lines with a lower loss ratio.

The policy acquisition cost ratio increased for the three months ended June 30, 2023, primarily due to lower ceded commissions and the absence of earned premium adjustments recorded in prior year that have a lower expense ratio.

The policy acquisition cost ratio decreased for the six months ended June 30, 2023, due to the favorable impact of higher net premiums earned, partially offset by lower ceded commissions.

The administrative expense ratio remained essentially flat for the three and six months ended June 30, 2023, as higher pension expenses, which will continue through 2023, is mostly offset by the favorable impact of higher net premiums earned.

The increase in pension expense reflects the adverse impact of market conditions in 2022.

The loss and loss expense ratio decreased for the three and nine months ended September 30, 2023, reflecting lower catastrophe losses, partially offset by lower favorable prior period development.

The CAY loss ratio excluding catastrophe losses decreased for the three and nine months ended September 30, 2023, primarily from a higher percentage of net premiums earned from lines with a lower loss ratio.

The policy acquisition cost ratio increased for the three months ended September 30, 2023, primarily due to changes in mix of business away from products that have a lower acquisition cost ratio.

The administrative expense ratio increased for the three and nine months ended September 30, 2023, primarily due to higher pension expenses and higher employee-related expenses, partially offset by the favorable impact of higher net premiums earned.

The increase in pension expense reflects the adverse impact of market conditions in 2022 and will continue through 2023.

Policy benefits

Policy benefits represent losses on contracts classified as long-duration and generally include accident and supplemental health products, term and whole life products, endowment products, and annuities.

In addition, Policy benefits for the three and six months ended June 30, 2023 includes the results of Cigna's business acquired during the third quarter of 2022.

Policy benefits for the three and nine months ended September 30, 2023, include the results of Huatai Group from July 1, 2023.

In addition, Policy benefits for the three and nine months ended September 30, 2023, include the results of Cigna's business acquired during the third quarter of 2022.

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

For the three months ended June 30, 2023 and 2022, Policy benefits were $830 million and $361 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 $(12) million and $(18) million, respectively.

For the three months ended September 30, 2023 and 2022, Policy benefits were $938 million and $707 million, respectively, which include (gains) losses from fair value changes in separate account liabilities that do not qualify for separate account reporting under GAAP of $(19) million and $(67) 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 $842 million and $379 million for the three months ended June 30, 2023 and 2022, respectively.

For the six months ended June 30, 2023 and 2022, Policy benefits were $1,627 million and $734 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 $(37) million and $(49) million, respectively.

Excluding the separate account gains and losses, Policy benefits were $957 million and $774 million for the three months ended September 30, 2023 and 2022, respectively.

For the nine months ended September 30, 2023 and 2022, Policy benefits were $2,565 million and $1,441 million, respectively, which include (gains) losses from fair value changes in separate account liabilities that do not qualify for separate account reporting under GAAP of $(56) million and $(116) 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 $1,664 million and $783 million for the six months ended June 30, 2023 and 2022, respectively.

Excluding the separate account gains and losses, Policy benefits were $2,621 million and $1,557 million for the nine months ended September 30, 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 Six Months Ended June 30, 2023 and 2022

Segment Operating Results – Three and Nine Months Ended September 30, 2023 and 2022

We operate through six business segments:

4 unchanged sentences

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 Six Months Ended

June 30 % Change June 30 % Change

Three Months Ended Nine Months Ended

September 30 % Change September 30 % Change

(in millions of U.S.

8 unchanged sentences

Net investment income 780 589 32.5 % 2,204 1,600 37.7 %

Other (income) expense 5 — NM 12 6 88.2 %

Other (income) expense 6 6 — 18 12 48.3 %

Segment income $ 1,521 $ 975 56.0 % $ 4,470 $ 3,739 19.6 %

7 unchanged sentences

Combined ratio 84.2 % 90.9 % (6.7) pts 83.3 % 83.0 % 0.3 pts

NM - Not meaningful

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

June 30 June 30

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

September 30 September 30

(in millions of U.S.

2 unchanged sentences

Favorable prior period development $ 84 $ 166 $ 302 $ 561

Catastrophe losses through June 30, 2023 and 2022, were primarily from the following events:

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

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

Catastrophe losses through September 30, 2023 and 2022, were primarily from the following events:

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

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

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

Net premiums written increased $490 million, or 10.5 percent, and $739 million, or 8.5 percent for the three and six months ended June 30, 2023, respectively, reflecting strong premium retention, including both rate and exposure increases, and strong new business.

The increase in premiums was across most lines of business, most notably in property, but also in casualty excluding workers' compensation and commercial multiple peril lines.

This growth was partially offset by a decline in financial lines due to lower renewal business.

Net premiums earned increased $358 million, or 8.4 percent, and $613 million, or 7.3 percent for the three and six months ended June 30, 2023, respectively, reflecting the growth in net premiums written described above.

Net premiums written increased $410 million, or 8.7 percent, and $1,149 million, or 8.6 percent for the three and nine months ended September 30, 2023, respectively, reflecting strong premium retention, including both rate and exposure increases, strong new business, as well as an increase in workers' compensation audit exposure in the current year.

The increase in premiums was across most lines of business, most notably in property, but also in casualty and commercial multiple peril.

Net premiums earned increased $452 million, or 10.6 percent, and $1,065 million, or 8.4 percent for the three and nine months ended September 30, 2023, respectively, reflecting the growth in net premiums written described above.

Combined Ratio

The loss and loss expense ratio increased for the three and six months ended June 30, 2023, primarily from higher catastrophe losses and lower favorable prior period development.

The loss and loss expense ratio decreased for the three and nine months ended September 30, 2023, primarily from lower catastrophe losses and a higher percentage of premiums earned from lines that have a lower loss ratio, partially offset by lower favorable prior period development.

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

The CAY loss ratio excluding catastrophe losses decreased for the three and six months ended June 30, 2023, primarily from a higher percentage of net premiums earned from property lines that have a lower loss ratio.

The policy acquisition cost ratio increased for the three and six months ended June 30, 2023, primarily due to lower ceded commissions.

The administrative expense ratio increased for the three and six months ended June 30, 2023, primarily from higher pension expenses which will continue through 2023, partially offset by the favorable impact of higher net premiums earned.

The increase in pension expense reflects the adverse impact of market conditions in 2022.

The administrative expense ratio increased for the three and nine months ended September 30, 2023, primarily from higher pension expenses and higher employee-related expenses, partially offset by the favorable impact of higher net premiums earned.

The increase in pension expense reflects the adverse impact of market conditions in 2022, and will 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 Six Months Ended

June 30 % Change June 30 % Change

Three Months Ended Nine Months Ended

September 30 % Change September 30 % Change

(in millions of U.S.

9 unchanged sentences

Other (income) expense 2 1 NM 2 3 NM

Amortization of purchased intangibles 3 3 — 5 5 —

Amortization of purchased intangibles 3 2 NM 8 7 NM

Segment income $ 225 $ 205 10.5 % $ 619 $ 693 (10.6) %

9 unchanged sentences

Catastrophe Losses and Prior Period Development

Three Months Ended Six Months Ended

June 30 June 30

Three Months Ended Nine Months Ended

September 30 September 30

(in millions of U.S.

2 unchanged sentences

Favorable prior period development $ 119 $ 133 $ 135 $ 187

Catastrophe losses through June 30, 2023 and 2022, were primarily from the following events:

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

Severe weather-related events in the U.S.

Catastrophe losses through September 30, 2023 and 2022, were primarily from the following events:

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

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

and Colorado wildfires.

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

Net premiums written increased $155 million, or 10.8 percent, and $271 million, or 10.4 percent for the three and six months ended June 30, 2023, respectively, primarily driven by record new business and strong renewal retention, from both rate and exposure increases, across all lines, principally in homeowners.

Net premiums earned increased $86 million, or 6.7 percent, and $159 million, or 6.3 percent for the three and six months ended June 30, 2023, respectively, reflecting the growth in net premiums written described above.

Net premiums written increased $135 million, or 9.6 percent, and $406 million, or 10.1 percent for the three and nine months ended September 30, 2023, respectively, primarily driven by strong new business and strong renewal retention, from both rate and exposure increases, across most lines, but most notably in homeowners.

Net premiums earned increased $73 million, or 5.5 percent, and $232 million, or 6.0 percent for the three and nine months ended September 30, 2023, respectively, reflecting the growth in net premiums written described above.

Combined Ratio

The loss and loss expense ratio increased for the three months ended June 30, 2023, primarily reflecting higher catastrophe losses, partially offset by higher favorable prior period development.

The loss and loss expense ratio increased for the six months ended June 30, 2023, primarily reflecting higher catastrophe losses in the current year, and a reserve release in the prior year due to lower than expected paid and reported loss activity.

The CAY loss ratio excluding catastrophe losses increased for the three and six months ended June 30, 2023, primarily reflecting higher auto and excess liability losses, partially offset by homeowners earned rate and exposure exceeding loss cost trends.

The increase in pension expense reflects the adverse impact of market conditions in 2022.

The CAY loss ratio excluding catastrophe losses decreased for the three and nine months ended September 30, 2023, primarily reflecting earned rate and exposure exceeding loss cost trends, as well as lower actual loss experience in homeowners, partially offset by higher auto and excess liability losses.

The loss and loss expense ratio decreased for the three months ended September 30, 2023, primarily reflecting the factors mentioned above, as well as a lower impact from catastrophe losses, partially offset by lower favorable prior period development.

The loss and loss expense ratio increased for the nine months ended September 30, 2023, primarily reflecting higher catastrophe losses in the current year and lower favorable prior period development.

The administrative expense ratio increased for the three and nine months ended September 30, 2023, primarily from higher pension expenses, partially offset by the favorable impact of higher net premiums earned.

The increase in pension expense reflects the adverse impact of market conditions in 2022, and will 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 Six Months Ended

June 30 % Change June 30 % Change

Three Months Ended Nine Months Ended

September 30 % Change September 30 % Change

(in millions of U.S.

5 unchanged sentences

Policy acquisition costs 76 68 11.1 % 128 111 15.0 %

Administrative expenses 3 2 65.7 % 6 1 NM

Administrative expenses 3 3 — 9 4 120.9 %

Underwriting income 105 158 (33.4) % 194 272 (28.7) %

Net investment income 12 9 47.3 % 43 23 91.7 %

Other (income) expense (1) — NM — — —

Other (income) expense — 1 NM — 1 NM

Amortization of purchased intangibles 6 7 (2.4) % 19 20 (2.4) %

9 unchanged sentences

NM - Not meaningful

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

June 30 June 30

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

September 30 September 30

(in millions of U.S.

dollars) 2023 2022 2023 2022

(Favorable) unfavorable catastrophe losses $ (5) $ 21 $ 19 $ 21

Favorable prior period development $ 3 $ — $ 3 $ 26

Catastrophe activity for the three months ended June 30, 2023, relates to development from the first quarter of 2023.

Catastrophe losses through June 30, 2023 and 2022, were primarily from the following events:

Catastrophe losses $ 18 $ 31 $ 37 $ 52

Favorable (unfavorable) prior period development $ 9 $ (9) $ 12 $ 17

Catastrophe losses through September 30, 2023 and 2022, were primarily from the following events:

flooding, hail, tornadoes, and wind events.

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

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

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

Net premiums written increased $29 million, or 4.0 percent, and $260 million, or 32.5 percent for the three and six months ended June 30, 2023, respectively, reflecting growth in MPCI due to higher commodity prices, principally from our fall-seeded crops, and strong new business in Chubb Agribusiness.

In addition, growth for the six months ended June 30, 2023 reflects the return of premium to the U.S.

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

Net premiums written decreased $202 million, or 11.7 percent for the three months ended September 30, 2023, mainly due to the timing of premium recognition this year versus last year, and a modest increase in the premium the company shared with the Federal Government.

Net premiums written increased $58 million, or 2.3 percent for the nine months ended September 30, 2023, reflecting the return of premium to the U.S.

government of $161 million in the first quarter of 2022 as part of a profit-sharing agreement and strong new business in Chubb Agribusiness, partially offset by higher cessions to the U.S.

government in

the current year.

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

Net premiums earned increased $62 million, or 11.0 percent, and $250 million, or 46.0 percent for the three and six months ended June 30, 2023, respectively, reflecting the factors described above.

Net premiums earned decreased $133 million, or 8.0 percent for the three months ended September 30, 2023, and increased $117 million, or 5.3 percent for the nine months ended September 30, 2023, reflecting the factors described above.

Combined Ratio

The CAY loss ratio excluding catastrophe losses increased for the three and six months ended June 30, 2023, primarily due to lower crop year gain estimated in the current year compared to the prior year through June 30 and the year-over-year impact of crop commodity price hedge activity, which resulted in an increase of 0.7 percentage points and 0.8 percentage points, respectively.

The decrease in the loss and loss expense ratio for the three months ended June 30, 2023, reflects catastrophe loss development from the first quarter of 2023.

The increase in the loss and loss expense ratio for the six months ended June 30, 2023, reflects the prior year impact of the return of premium to the U.S.

government mentioned above which had a corresponding reduction in incurred losses, partially offset by lower catastrophe losses.

The policy acquisition cost ratio increased for the three months ended June 30, 2023, reflecting changes in mix of business away from products that have a lower acquisition cost ratio.

The policy acquisition cost ratio decreased for the six months ended June 30, 2023, primarily from the favorable impact of higher net premiums earned from MPCI.

The administrative expense ratio increased for the six months ended June 30, 2023, reflecting lower Administrative and Operating (A&O) reimbursements on the MPCI business.

The CAY loss ratio excluding catastrophe losses increased for the three and nine months ended September 30, 2023, which contemplates a lower underwriting gain for the current crop year, partially offset by the year-over-year impact of crop commodity price hedge activity, which had a favorable impact of 0.7 percentage points and 0.2 percentage points, respectively.

Estimated development for the current crop year was recognized this quarter compared to the fourth quarter in the prior year.

The loss and loss expense ratio increased for the three and nine months ended September 30, 2023, reflecting the factors mentioned above.

The increase for the three months ended September 30, 2023, was partially offset by favorable prior period development, compared with unfavorable prior period development in the prior year, and lower catastrophe losses.

The increase in loss and loss expense ratio for the nine months ended September 30, 2023, also reflects the prior year impact of the return of premium to the U.S.

government mentioned above, which had a corresponding reduction in incurred losses, and lower favorable prior period development, partially offset by lower catastrophe losses.

The policy acquisition cost ratio increased for the three and nine months ended September 30, 2023, reflecting changes in mix of business away from products that have a lower acquisition cost ratio.

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 Six Months Ended

June 30 % Change June 30 % Change

Effective July 1, 2023, the Overseas General Insurance segment includes 100 percent of the results of Huatai Group's P&C business as required under consolidation accounting.

We previously included our share of Huatai results based on our equity method investment within Other (income) expense.

Three Months Ended Nine Months Ended

September 30 % Change September 30 % Change

(in millions of U.S.

23 unchanged sentences

Catastrophe Losses and Prior Period Development

Three Months Ended Six Months Ended

June 30 June 30

Three Months Ended Nine Months Ended

September 30 September 30

(in millions of U.S.

2 unchanged sentences

Favorable prior period development $ 49 $ 5 $ 253 $ 238

Catastrophe losses through June 30, 2023 and 2022, were primarily from the following events:

Storms in New Zealand, flooding in Italy, and international weather-related events.

Storms in Australia and international weather-related events.

Catastrophe losses through September 30, 2023 and 2022, were primarily from the following events:

Storms in New Zealand and international weather-related events.

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

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

Net Premiums Written by Region

Three months ended June 30

Three months ended September 30

(in millions of U.S.

6 unchanged sentences

Asia Pacific (1)

1,099 34 % 816 31 % 809 34.5 % 35.9 %

Japan 102 3 % 101 4 % 96 0.9 % 5.5 %

1 unchanged sentence

Net premiums written $ 3,211 100 % $ 2,645 100 % $ 2,738 21.4 % 17.3 %

Six months ended June 30

Nine months ended September 30

(in millions of U.S.

6 unchanged sentences

Asia Pacific (1)

2,644 28 % 2,192 26 % 2,127 20.6 % 24.3 %

Japan 349 4 % 359 4 % 328 (2.8) % 6.2 %

1 unchanged sentence

Net premiums written $ 9,359 100 % $ 8,364 100 % $ 8,304 11.9 % 12.7 %

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

Overall, net premiums written increased $245 million and $429 million, or $285 million and $582 million on a constant dollar basis, for the three and six months ended June 30, 2023, respectively, reflecting growth in both commercial and consumer lines.

For the three and six months ended June 30, 2023, commercial lines grew 9.2 percent and 7.6 percent, or 11.9 percent and 11.3 percent on a constant-dollar basis, respectively, and consumer lines grew 9.3 percent and 7.4 percent, or 9.5 percent and 9.0 percent on a constant-dollar basis, respectively.

Our European division increased for the three and six months ended June 30, 2023, supported by both our wholesale and retail divisions.

(1) 2023 includes the consolidated results of Huatai P&C effective July 1,2023.

(2) Includes the international supplemental A&H business of Combined Insurance and other international operations.

Overall, net premiums written increased $566 million and $995 million, or $473 million and $1,055 million on a constant dollar basis, for the three and nine months ended September 30, 2023, respectively, reflecting growth in both commercial and consumer lines.

For the three and nine months ended September 30, 2023, commercial lines grew 17.0 percent and 10.5 percent, or 14.6 percent and 12.4 percent on a constant-dollar basis, respectively, and consumer lines grew 28.4 percent and 14.1 percent, or 21.4 percent and 13.2 percent on a constant-dollar basis, respectively.

Our European division increased for the three and nine months ended September 30, 2023, supported by both our wholesale and retail divisions.

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

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

Latin America increased for the three and six months ended June 30, 2023, driven by growth in commercial lines due to exposure increases, positive rate increases, and new business, primarily property and casualty lines.

Consumer lines grew due to increased A&H.

Asia Pacific increased for the three and six months ended June 30, 2023, driven by higher new business, higher retention and positive rate increases in commercial lines, including property and casualty lines and growth attributable to the acquisition of Cigna's business in Asia.

Consumer lines increased primarily from travel in A&H.

Japan increased for the three and six months ended June 30, 2023, on a constant-dollar basis, primarily from higher new business in A&H.

Net premiums earned increased $212 million and $370 million, or $244 million and $496 million on a constant-dollar basis, for the three and six months ended June 30, 2023, respectively, reflecting the increase in net premiums written described above.

Latin America increased for the three and nine months ended September 30, 2023, driven by growth in commercial lines due to exposure increases, positive rate increases, and new business, primarily property and casualty lines.

Growth in consumer was driven by an increase in personal lines.

Asia Pacific increased for the three and nine months ended September 30, 2023, reflecting the consolidation of Huatai Group's P&C business effective July 1, 2023, higher new business, higher retention and positive rate increases in commercial lines, primarily property and casualty lines.

Growth in consumer lines is attributable to the acquisition of Cigna's business in Asia, as well as increased travel in A&H.

Japan increased for the three and nine months ended September 30, 2023, on a constant-dollar basis, primarily from higher new business in A&H.

Net premiums earned increased $570 million and $940 million, or $460 million and $956 million on a constant-dollar basis, for the three and nine months ended September 30, 2023, respectively, reflecting the increase in net premiums written described above.

Combined Ratio

The loss and loss expense ratio increased for the three months ended June 30, 2023, due to lower favorable prior period development, partially offset by lower catastrophe losses.

The loss and loss expense ratio decreased for the six months ended June 30, 2023, due to lower catastrophe losses, partially offset by lower favorable prior period development.

The CAY loss ratio excluding catastrophe losses decreased for the three and six months ended June 30, 2023, primarily due to underlying loss ratio improvement.

The administrative expense ratio decreased for the three and six months ended June 30, 2023, reflecting the favorable impact of higher net premiums earned, partially offset by increased investment to support growth.

The loss and loss expense ratio decreased for the three months ended September 30, 2023, due to higher favorable prior period development.

The loss and loss expense ratio decreased for the nine months ended September 30, 2023, due to lower catastrophe losses.

The CAY loss ratio excluding catastrophe losses increased for the three and nine months ended September 30, 2023, primarily due to higher losses in personal lines.

The policy acquisition cost ratio decreased for the three and nine months ended September 30, 2023, 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 increased for the three months ended September 30, 2023, reflecting the impact from the consolidation of Huatai Group's P&C business effective July 1, 2023.

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 Six Months Ended

June 30 % Change June 30 % Change

Three Months Ended Nine Months Ended

September 30 % Change September 30 % Change

(in millions of U.S.

7 unchanged sentences

Administrative expenses 9 8 4.2 % 27 27 —

Underwriting income 72 16 NM 133 65 103.4 %

Underwriting income 45 (123) NM 178 (58) NM

Net investment income 47 71 (34.4) % 144 232 (37.9) %

Other (income) expense — 1 NM (1) 1 NM

Segment income $ 120 $ 91 31.2 % $ 231 $ 225 2.7 %

Other (income) expense — — — (1) 1 NM

Segment income (loss)

$ 92 $ (52) NM $ 323 $ 173 86.7 %

Loss and loss expense ratio:

8 unchanged sentences

Catastrophe Losses and Prior Period Development

Three Months Ended Six Months Ended

June 30 June 30

Three Months Ended Nine Months Ended

September 30 September 30

(in millions of U.S dollars) 2023 2022 2023 2022

1 unchanged sentence

Favorable (unfavorable) prior period development $ — $ — $ 25 $ (22)

Catastrophe losses through September 30, 2023 and 2022, were primarily from the following events:

Hurricane Idalia.

Hurricane Ian, and storms in Australia and Canada.

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

Net premiums written increased $31 million and $55 million for the three and six months ended June 30, 2023, respectively, primarily from new business and rate increases in property, partially offset by lower catastrophe reinstatement premiums.

Net premiums earned increased $15 million and $24 million for the three and six months ended June 30, 2023, respectively, primarily reflecting the increase in net premiums written described above.

Net premiums written decreased $4 million for the three months ended September 30, 2023, as continued growth in the portfolio, primarily in property lines, was more than offset by the impact of catastrophe reinstatement premiums recognized in the prior year.

Net premiums written increased $51 million for the nine months ended September 30, 2023 reflecting continued growth in the portfolio, primarily in property lines, partially offset by the impact of catastrophe reinstatement premiums recognized in the prior year.

Net premiums earned decreased $16 million and increased $8 million for the three and nine months ended September 30, 2023, respectively, primarily reflecting the changes in net premiums written described above.

The change in net premiums earned also reflects the impact of catastrophe reinstatement premiums recognized in the prior year, which are fully earned when written.

Combined Ratio

The loss and loss expense ratio decreased for the three and six months ended June 30, 2023, mainly from favorable prior period development and lower catastrophe losses.

The CAY loss ratio excluding catastrophe losses decreased for the three and six months ended June 30, 2023, primarily from an improvement in market conditions which lowered loss ratio expectations in several lines of business, including property, casualty, and workers' compensation lines.

The policy acquisition cost ratio increased for the three months ended June 30, 2023, primarily due to lower catastrophe reinstatement premiums which have a lower acquisition cost ratio.

The administrative expense ratio decreased for the three and six months ended June 30, 2023, primarily due to the favorable impact of higher net premiums earned.

The loss and loss expense ratio decreased for the three and nine months ended September 30, 2023, mainly from lower catastrophe losses.

The decrease in the loss and loss expense ratio for the nine months ended September 30, 2023, also reflects favorable prior period development compared with unfavorable development in the prior year period.

The CAY loss ratio excluding catastrophe losses decreased for the three and nine months ended September 30, 2023, primarily from an improvement in market conditions in several lines of business, including property, casualty, and workers' compensation lines.

The policy acquisition cost ratio increased for the three and nine months ended September 30, 2023, primarily due to lower catastrophe reinstatement premiums recognized in the prior year, which have a lower acquisition cost ratio.

The administrative expense ratio increased for the three months ended September 30, 2023, reflecting the impact of lower net premiums earned, as described above.

Life Insurance

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.

Effective July 1, 2023, the Life Insurance segment includes 100 percent of the results of Huatai Group's life and asset management business as required under consolidation accounting.

We previously included our share of Huatai results based on our equity method investment within Other (income) expense.

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.

Results for the three and six months ended June 30, 2022, respectively, are adjusted to reflect the adoption of LDTI.

Results for the three and nine months ended September 30, 2022, respectively, are adjusted to reflect the adoption of LDTI.

Refer to Note 1 c).

Three Months Ended Six Months Ended

June 30 % Change June 30 % Change

Three Months Ended Nine Months Ended

September 30 % Change September 30 % Change

(in millions of U.S.

9 unchanged sentences

Net investment income 211 147 42.5 % 525 359 45.9 %

Other (income) expense (26) (12) 138.0 % (41) (42) (1.2) %

Amortization of purchased intangibles 2 3 (9.7) % 6 5 34.1 %

Other (income) expense (28) 4 NM (69) (38) 90.3 %

Amortization of purchased intangibles 12 2 NM 18 7 170.6 %

Segment income $ 288 $ 252 14.8 % $ 786 $ 479 64.6 %

Net premiums written increased $708 million and $1,425 million, or $712 million and $1,440 million on a constant-dollar basis, for the three and six months ended June 30, 2023, respectively.

For our international life operations, net premiums written increased 234.5 percent and 236.1 percent for the three and six months ended June 30, 2023, respectively, primarily due to the acquisition of Cigna's business in Asia.

In addition, there was growth in Latin America, primarily in our bank distribution channels, and in Asia, principally in Hong Kong.

Net premiums written in our North American Combined Insurance business declined 5.7 percent and 6.3 percent, for the three and six months ended June 30, 2023, respectively, as growth in the supplemental A&H business was more than offset by the non-renewal of a large program.

NM - not meaningful

Net premiums written increased $187 million and $1,612 million, or $191 million and $1,631 million on a constant-dollar basis, for the three and nine months ended September 30, 2023, respectively.

For our international life operations, net premiums written increased 19.7 percent for the three months ended September 30, 2023, primarily due to the consolidation of Huatai Group's life business which contributed $149 million or 14.8 percentage points, and growth in Asia and Latin America.

Our international life operations net premiums written increased 101.8 percent

for the nine months ended September 30, 2023, primarily due to the acquisition of Cigna's business in Asia, underlying growth in existing business from Latin America bank distribution channels, and Asia agency and partnership channels.

Net premiums written in our North American Combined Insurance business declined 3.9 percent and 5.5 percent, for the three and nine months ended September 30, 2023, respectively, as growth in the supplemental A&H business was more than offset by the non-renewal of a large program.

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

Three Months Ended Six Months Ended

June 30 % Change June 30 % Change

Three Months Ended Nine Months Ended

September 30 % Change September 30 % Change

(in millions of U.S.

3 unchanged sentences

Deposits collected on universal life and investment contracts $ 388 $ 449 $ 433 (13.4) % (10.2) % $ 1,097 $ 1,433 $ 1,352 (23.4) % (18.8) %

$ 400 $ 427 $ 408 (6.6) % (2.0) % $ 709 $ 984 $ 919 (27.9) % (22.8) %

(1) The three months ended June 30, 2023, includes a favorable adjustment of $27 million;

excluding this item, deposits decreased 13.0 percent, or 8.7 percent on a constant-dollar basis.

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 $27 million and $275 million for the three and six months ended June 30, 2023, respectively, primarily in Taiwan, reflecting challenging market conditions for deposit products.

Partially offsetting the decline for the three and six months ended June 30, 2023, respectively, are deposits collected through the acquired Cigna businesses in Asia.

Life deposits collected decreased $61 million and $336 million for the three and nine months ended September 30, 2023, respectively, primarily in Taiwan, reflecting challenging market conditions for deposit products due to market volatility and a rapid increase in interest rates.

The decrease in collections was partially offset by deposit growth from the consolidation of Huatai Group.

Life Insurance segment income

Life Insurance segment income increased $148 million and $271 million for the three and six months ended June 30, 2023, respectively, reflecting growth from the acquisition of Cigna's business in Asia, primarily in Korea.

Growth for the three and six months ended June 30, 2023 also reflected higher net investment income due to a higher invested asset base, including from the Cigna acquisition, and $5 million and $10 million, respectively, from equity securities supporting policyholder dividends.

Grow th for the three months ended June 30, 2023, also included higher income from our investment in Huatai, our partially-owned insurance entity in China from higher investment income as well as from our increased ownership interest compared to prior year.

Income from Huatai is recorded under the equity method of accounting with our share of net income or loss reported in Other (income) expense.

Effective July 1, 2023, and starting with our third quarter 2023 reporting, we will apply consolidation accounting to our investment in Huatai.

Life Insurance segment income increased $36 million for the three months ended September 30, 2023 reflecting the growth in premiums described above, higher net investment income and higher income from Huatai.

Life Insurance segment income growth of $307 million for the nine months ended September 30, 2023, also reflects the acquisition of Cigna's business in Asia in the third quarter of 2022, and higher net investment income due to a higher invested asset base.

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.

Results for the three and six months ended June 30, 2022, are adjusted to reflect the adoption of LDTI.

Effective July 1, 2023, 100 percent of Huatai Group’s non-insurance operations results, comprising real estate and holding company activity, are included in Corporate.

Results for the three and nine months ended September 30, 2022, are adjusted to reflect the adoption of LDTI.

Refer to Note 1 c).

Three Months Ended Six Months Ended

June 30 % Change June 30 % Change

Three Months Ended Nine Months Ended

September 30 % Change September 30 % Change

(in millions of U.S.

5 unchanged sentences

Net investment income (loss) 14 5 NM 28 (4) NM

Other (income) expense 14 138 (91.0) % (200) (121) 66.0 %

Other (income) expense (51) 194 NM (251) 73 NM

Amortization of purchased intangibles 44 46 (1.7) % 129 137 (4.9) %

Net realized gains (losses) (96) (437) (78.0) % (481) (927) (48.0) %

Market risk benefits gains (losses) (7) (33) (79.9) % (122) 16 NM

Market risk benefits gains (losses) (32) 69 NM (154) 85 NM

Interest expense 174 150 15.6 % 499 416 19.8 %

Cigna integration expenses 15 3 NM 37 3 NM

Cigna integration expenses 14 23 (38.8) % 51 26 99.4 %

Income tax expense 413 263 57.2 % 1,189 907 31.1 %

Net loss (867) (1,204) (27.8) % (2,647) (2,944) (10.0) %

Net loss attributable to noncontrolling interests

(3) — NM (3) — NM

Net loss attributable to Chubb $ (864) $ (1,204) (28.0) % $ (2,644) $ (2,944) (10.1) %

NM - not meaningful

Losses and loss expenses primarily includes unfavorable prior period development for molestation claims.

Administrative expenses increased $5 million and $19 million for the three and six months ended June 30, 2023, respectively, primarily due to increased spending to support digital growth initiatives.

Cigna integration expenses of $15 million and $37 million for the three and six months ended June 30, 2023 , respectively, principally comprised legal and professional fees and all other costs directly related to the integration activities of the Cigna acquisition.

Losses and loss expenses primarily includes unfavorable prior period development for molestation claims and legacy environmental claims.

Administrative expenses increased $7 million and $26 million for the three and nine months ended September 30, 2023, respectively, primarily due to increased spending to support digital growth initiatives.

Cigna integration expenses of $14 million and $51 million for the three and nine months ended September 30, 2023 , respectively, 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.

7 unchanged sentences

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 public and private equity securities and derivatives, including financial futures, options, and swaps.

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.

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 June 30

Three Months Ended September 30

(As Adjusted)

12 unchanged sentences

Instrument-specific credit risk on market risk benefits — (5) (5) — 8 8

Other (6) 48 42 — 5 5

92 48 140 (40) (59) (99)

Net (losses), pre-tax $ (103) $ (1,772) $ (1,875) $ (456) $ (3,559) $ (4,015)

Six Months Ended June 30

(1) The three months ended September 30, 2023 includes a one-time realized gain of $116 million as a result of the consolidation of Huatai Group.

Nine Months Ended September 30

(As Adjusted)

12 unchanged sentences

Instrument-specific credit risk on market risk benefits — 3 3 — 48 48

Other (13) 15 2 (74) 24 (50)

79 63 142 (114) (35) (149)

Net gains (losses), pre-tax $ (484) $ (1,305) $ (1,789) $ (936) $ (12,113) $ (13,049)

Pre-tax net unrealized losses of $1,194 million in our investment portfolio for the three months ended June 30, 2023 was primarily driven by higher interest rates as well as the $423 million pre-tax impact of the reclassification of our approximately $8 billion HTM portfolio to our AFS portfolio.

This reclassification to AFS increases management's flexibility to execute on its investment strategy to take advantage of higher yields when the opportunity arises, while not making any major change to its current asset allocation.

(1) The nine months ended September 30, 2023 Includes a one-time realized gain of $116 million as a result of the consolidation of Huatai Group.

Pre-tax net unrealized losses of $2,181 million and $1,589 million in our investment portfolio for the three and nine months ended September 30, 2023, respectively, were primarily driven by higher interest rates.

Refer to Note 3 a) to the Consolidated Financial Statements.

Pre-tax net unrealized gains of $592 million for the six months ended June 30, 2023 were principally the result of changes in interest rates.

In addition, there were pre-tax net realized losses of $114 million and $314 million for the three and six months ended June 30, 2023, respectively, comprising losses from sales and impairments of fixed maturities and derivative losses.

Pre-tax net realized losses of $484 million for the nine months ended September 30, 2023 mainly comprised losses from sales and impairments of fixed maturities and derivative losses, as well as foreign exchange losses.

Effective Income Tax Rate

1 unchanged sentence

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

For the three and six months ended June 30, 2023, our ETR was 17.9 percent and 17.4 percent, respectively.

This compares to an ETR of 19.6 percent and 17.0 percent for the three and six months ended June 30, 2022.

The ETR for each period in 2023 was impacted by our mix of earnings among various jurisdictions, most notably related to gains/(losses) that were realized, the impact of our Cigna acquisition, and an increase in the enacted UK tax rate, partially offset by discrete tax items.

For the three and nine months ended September 30, 2023, our ETR was 16.8 percent and 17.2 percent, respectively.

This compares to an ETR of 24.9 percent and 18.7 percent for the three and nine months ended September 30, 2022, respectively.

The ETR for each period was impacted by our mix of earnings among various jurisdictions, most notably related to realized gains/(losses), the impact of the consolidation of Huatai Group, and an increase in the enacted UK tax rate, offset by discrete tax items.

Non-GAAP Reconciliation

2 unchanged sentences

However, they should not be viewed as a substitute for measures determined in accordance with GAAP.

Book value per common share is shareholders’ equity divided by the shares outstanding.

Tangible book value per common share is shareholders’ equity less goodwill and other intangible assets, net of tax, divided by the shares outstanding.

We believe that book value comparisons to less acquisitive peer companies are more meaningful when adjusted for goodwill and other intangible assets.

The calculation of tangible book value per share does not consider the embedded goodwill attributable to our investments in partially-owned insurance companies until we consolidate .

We provide financial measures, including net premiums written, net premiums earned, and underwriting income on a constant-dollar basis.

24 unchanged sentences

Three Months Ended

June 30, 2023

September 30, 2023

(in millions of U.S.

15 unchanged sentences

Expense adjustments - favorable (unfavorable) (7) — — — — — (7)

Policy acquisition costs and administrative expenses, adjusted D $ 926 $ 361 $ 40 $ 1,038 $ 74 $ 95 $ 2,534

CAY Policy acquisition costs and administrative expenses, adjusted D $ 956 $ 371 $ 79 $ 1,154 $ 78 $ 98 $ 2,736

Net premiums earned E $ 4,735 $ 1,407 $ 1,540 $ 3,311 $ 239 $ 11,232

19 unchanged sentences

Three Months Ended

June 30, 2022

September 30, 2022

(in millions of U.S.

9 unchanged sentences

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

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

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

3 unchanged sentences

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

Policy acquisition costs and administrative expenses, adjusted D $ 823 $ 331 $ 33 $ 975 $ 67 $ 90 $ 2,319

CAY 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

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

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

16 unchanged sentences

Reinsurance Corporate Total P&C

Six Months Ended

June 30, 2023

Nine Months Ended

September 30, 2023

(in millions of U.S.

15 unchanged sentences

Expense adjustments - favorable (unfavorable) (14) — — — — — (14)

Policy acquisition costs and administrative expenses, adjusted D $ 1,831 $ 712 $ 58 $ 2,031 $ 145 $ 192 $ 4,969

CAY Policy acquisition costs and administrative expenses, adjusted D $ 2,787 $ 1,083 $ 137 $ 3,185 $ 223 $ 290 $ 7,705

Net premiums earned E $ 13,710 $ 4,084 $ 2,334 $ 9,005 $ 720 $ 29,853

18 unchanged sentences

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

Six Months Ended

June 30, 2022

Nine Months Ended

September 30, 2022

(in millions of U.S.

15 unchanged sentences

Expense adjustments - favorable (unfavorable) (4) — 1 — — — (3)

Policy acquisition costs and administrative expenses, adjusted D $ 1,655 $ 660 $ 45 $ 1,923 $ 138 $ 173 $ 4,594

CAY Policy acquisition costs and administrative expenses, adjusted D $ 2,511 $ 1,005 $ 116 $ 2,907 $ 205 $ 264 $ 7,008

Net premiums earned E $ 12,645 $ 3,852 $ 2,217 $ 8,065 $ 712 $ 27,491

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

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

18 unchanged sentences

Amortization of purchased intangibles

Amortization expense related to purchased intangibles was $70 million and $142 million for the three and six months ended June 30, 2023, respectively, compared with $71 million and $142 million for the prior year periods, respectively.

At June 30, 2023, the deferred tax liability associated with the Other intangible assets (excluding the fair value adjustment on Unpaid losses and loss expense) was $1,200 million.

The following table presents, as of June 30, 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 third through fourth quarters of 2023 and for the next five years:

Amortization expense related to purchased intangibles was $84 million and $226 million for the three and nine months ended September 30, 2023, respectively, compared with $69 million and $211 million for the prior year periods, respectively.

At September 30, 2023, the deferred tax liability associated with the Other intangible assets (excluding the fair value adjustment on Unpaid losses and loss expenses) was $1,577 million.

Refer to Note 7 to the Consolidated Financial Statements for the expected pre-tax amortization expense of purchased intangibles, which are presented gross of noncontrolling interests.

The following table presents, as of September 30, 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 fourth quarter of 2023 and for the next five years:

For the Years Ending December 31

1 unchanged sentence

dollars) Reduction to deferred tax liability associated with intangible assets

Third quarter of 2023 $ 16

Fourth quarter of 2023 $ 24

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

The following table presents, as of June 30, 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 third through fourth quarters of 2023 and for the next five years:

The following table presents, as of September 30, 2023, the expected amortization expense of the fair value adjustment on acquired invested assets related to the acquisitions of Huatai Group, 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 fourth quarter of 2023 and for the next five years:

Amortization (expense) benefit of the fair value adjustment on

1 unchanged sentence

(in millions of U.S.

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

dollars) Total acquired invested assets (1)

Assumed long-term debt (2)

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

Fourth quarter of 2023 $ (8) $ 6

2024 19 (20) (1) 21

2025 17 (9) 8 21

2026 15 — 15 21

2027 13 — 13 21

2028 12 — 12 21

Total $ (38) $ 111

4 unchanged sentences

Three Months Ended

June 30 Six Months Ended

September 30 Nine Months Ended

(in millions of U.S.

5 unchanged sentences

Equity securities 53 21 68 93

Private equities 18 24 38 50

Other investments

7 unchanged sentences

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 28.9 percent and 31.7 percent for the three and six months ended June 30, 2023, respectively, primarily due to higher reinvestment rates on fixed maturities.

Net investment income increased 34.2 percent and 32.6 percent for the three and nine months ended September 30, 2023, respectively, primarily due to higher reinvestment rates on fixed maturities and the consolidation of Huatai group.

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

3 unchanged sentences

Three Months Ended

June 30 Six Months Ended

September 30 Nine Months Ended

(in millions of U.S.

1 unchanged sentence

Total mark-to-market gain (loss) on private equity, pre-tax $ 90 $ (232) $ 364 $ (52)

Interest Expense

Interest expense for the six months ended June 30, 2023, comprised $335 million related to fixed expenses on existing debt obligations and variable expenses, and a $10 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 six months ended June 30, 2023, was higher than expected primarily due to rising interest rates on held collateral and repurchase agreements.

Based on our existing fixed debt obligations and projected variable expenses, we now expect pre-tax interest expense on these items to be approximately $342 million for the remainder of 2023, or $171 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.

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 June 30, 2023.

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

Other investments principally comprise direct investments, investment funds, and limited partnerships.

Huatai's portfolio is predominantly managed internally by Huatai’s asset management companies.

Private equities principally comprises investment funds and limited partnerships.

We hold no collateralized debt obligations in our investment portfolio, and we provide no credit default protection.

1 unchanged sentence

Exposures are aggregated, monitored, and actively managed by our Global Credit Committee, comprising senior executives, including our Chief Financial Officer, our Chief Risk Officer, our Chief Investment Officer, and our Treasurer.

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 was 4.6 years and 4.5 years at June 30, 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 $4.6 billion at June 30, 2023.

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 was 4.7 years, which excludes Huatai, and 4.5 years at September 30, 2023, and December 31, 2022, respectively.

We exclude Huatai in order to make comparison to prior period meaningful .

We estimate that a 100 basis point (bps) increase in interest rates would reduce the valuation of our fixed income portfolio by approximately $5 billion at September 30, 2023.

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

June 30, 2023 December 31, 2022

September 30, 2023 December 31, 2022

(in millions of U.S.

1 unchanged sentence

Cost, Net Fair

Short-term investments $ 5,454 $ 5,455 $ 4,960 $ 4,962

Fixed maturities available for sale 99,766 109,197 85,220 93,186

Fixed maturities held to maturity — — 8,439 8,848

Short-term investments 4,097 4,099 4,960 4,962

Fixed income securities 105,220 114,652 98,619 106,996

Equity securities 3,395 3,395 827 827

Private debt held-for-investment 2,389 2,401 — —

Private equities 13,362 13,362 12,355 12,355

Other investments 5,583 5,583 1,341 1,341

Total investments $ 129,949 $ 139,393 $ 113,142 $ 121,519

The fair value of our total investments increased $3.5 billion during the six months ended June 30, 2023, primarily due to the investing of operating cash flow and unrealized gains on fixed maturities, partially offset by share repurchases and dividend payments.

The following tables present the fair value of our fixed income securities at June 30, 2023, and December 31, 2022.

The fair value of our total investments increased $16.8 billion during the nine months ended September 30, 2023, primarily due to the consolidation of Huatai, which added $12.7 billion, and investing of operating cash flow, partially offset by unrealized losses, share repurchases, and dividend payments.

On July 1, 2023, our ownership interest in Huatai increased to 69.6 percent and Huatai became a consolidated subsidiary of Chubb.

Consolidation accounting requires including 100 percent of Huatai’s results of operations and financial position within our Consolidated financial statements.

Therefore, at September 30, 2023, total investments included $12.7 billion related to Huatai's investment portfolio, of which $6.5 billion is economically owned by Chubb and $6.2 billion attributable to noncontrolling interests.

The noncontrolling interests comprises both the portion that we do not own of Huatai based on our current ownership percentage, as well as the required consolidation of VIEs where we are the primary beneficiary, which is generally if we hold an economic interest of 10 percent or more.

These VIEs are related to sponsored investment products, principally mutual funds, that are created and managed by Huatai’s asset management companies.

These VIEs totaled $5.4 billion related to investments, of which our economic interest is $1.6 billion, with the remainder related to investors other than Chubb which are reported under Noncontrolling interests.

Refer to Note 3 g) in the Consolidated Financial Statements for further detail on VIEs.

The following table presents the investments included in our Consolidated balance sheet relating to Huatai's investment portfolio at September 30, 2023, which are presented gross of noncontrolling interests required by consolidation accounting.

Also provided below is the portion of Huatai’s investments that is owned by Chubb based on our ownership interest (shown below as attributable to Chubb) as a gauge to measure Chubb’s net economic investment exposure:

September 30, 2023

(in millions of U.S.

Noncontrolling Interests

Attributable to Chubb

Short-term investments

$ 1,015 $ 491 $ 524

Fixed maturities available for sale

2,748 696 2,052

Private debt held-for-investment

2,401 656 1,745

Equity securities

2,286 1,329 957

Private equities

Other investments

4,187 3,031 1,156

Total $ 12,670 $ 6,218 $ 6,452

Huatai’s investment portfolio comprised investments of predominantly investment grade fixed maturities, private debt, and mutual funds that hold principally fixed income securities.

Private debt are investments with stated interest rates and maturity dates with fixed or determinable payments.

Mutual funds, for which a Huatai entity holds an economic interest of less than 10 percent, are recorded within equities securities on the Consolidated balance sheets and comprised principally of holdings in

fixed maturities.

Other investments principally comprised fixed income securities that are managed by Huatai’s asset management companies and are carried at fair value with changes in fair value recorded through the Consolidated statements of operations.

The average credit quality of Huatai’s fixed income portfolio is rated A.

The following tables present the fair value of our fixed income securities at September 30, 2023, and December 31, 2022.

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

June 30, 2023 December 31, 2022

September 30, 2023 December 31, 2022

(in millions of U.S.

18 unchanged sentences

Corporate and asset-backed securities

The following table presents our 10 largest global exposures to corporate bonds by fair value at June 30, 2023:

The following table presents our 10 largest global exposures to corporate bonds by fair value at September 30, 2023:

(in millions of U.S.

1 unchanged sentence

Bank of America Corp $ 739

JP Morgan Chase & Co 664

Morgan Stanley 651

JP Morgan Chase & Co 647

Wells Fargo & Co 572

4 unchanged sentences

Verizon Communications Inc 360

Comcast Corp 352

Mortgage-backed securities

2 unchanged sentences

Value Amortized Cost, Net

June 30, 2023

September 30, 2023

(in millions of U.S.

22 unchanged sentences

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

government securities at June 30, 2023:

government securities at September 30, 2023:

(in millions of U.S.

1 unchanged sentence

Republic of Korea $ 1,617 $ 1,701

People's Republic of China 1,345 1,340

Taiwan 955 923

6 unchanged sentences

Commonwealth of Australia 439 526

United Kingdom 401 450

Other Non-U.S.

3 unchanged sentences

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

corporate securities at June 30, 2023:

corporate securities at September 30, 2023:

(in millions of U.S.

dollars) Fair Value Amortized Cost, Net

China $ 5,761 $ 5,802

United Kingdom 2,536 2,764

5 unchanged sentences

Japan 759 819

Netherlands 549 590

Germany 575 631

Switzerland 488 539

Netherlands 563 613

Other Non-U.S.

5 unchanged sentences

corporations.

The tables above include Huatai invested assets which are required to be reported at 100 percent within our Consolidated balance sheets.

However, our economic exposure is limited to our ownership interest.

Below-investment grade corporate fixed income portfolio

3 unchanged sentences

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 June 30, 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.

At September 30, 2023, our corporate fixed income investment portfolio included below-investment grade and non-rated securities which, in total, comprised approximately 15 percent of our fixed income portfolio.

Our below-investment grade and non-rated portfolio includes over 1,720 issuers, with the greatest single exposure being $154 million.

20 unchanged sentences

Other (including foreign exchange translation) 600 290 310

Balance at June 30, 2023 $ 76,480 $ 16,608 $ 59,872

Balance at September 30, 2023 $ 79,705 $ 17,808 $ 61,897

(1) Net of valuation allowance for uncollectible reinsurance.

8 unchanged sentences

Asbestos and Environmental (A&E)

There was no significant A&E reserve activity during the three and six months ended June 30, 2023.

During the three months and nine months ended September 30, 2023, we increased environmental net loss reserves for Brandywine managed operations by $50 million.

A&E reserves are included in Corporate.

8 unchanged sentences

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 June 30, 2023, 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 September 30, 2023, and does not represent our expected catastrophe losses for any one year.

Modeled Net Probable Maximum Loss (PML) Pre-tax

4 unchanged sentences

(in millions of U.S.

dollars, except for percentages) Chubb % of Total

dollars, except for percentages) Chubb % of Total Chubb

Shareholders’

Equity Chubb % of Total

Equity Chubb % of Total Chubb

Shareholders’

Equity Chubb % of Total

Equity Chubb % of Total Chubb

Shareholders’

7 unchanged sentences

The PML for worldwide and key U.S.

peril regions are based on our in-force portfolio at April 1, 2023, and reflect the April 1, 2023, 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 July 1, 2023, and reflect the September 1, 2023, reinsurance program, as well as inuring reinsurance protection coverage.

This includes a $500 million excess of loss program for named windstorms and earthquakes within Northeast states, purchased and effective September 1, 2023.

Refer to the Global Property Catastrophe Reinsurance section for more information.

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 $3,477 million (or 6.6 percent of our total shareholders’ equity at June 30, 2023).

hurricane events could be in excess of $3,238 million (or 6.2 percent of total Chubb shareholders’ equity at September 30, 2023).

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

24 unchanged sentences

In addition, Chubb renewed its terrorism coverage (excluding nuclear, biological, chemical and radiation coverage, with an inclusion of coverage for biological and chemical coverage for personal lines) for the United States from April 1, 2023, through March 31, 2024, with the same limits and retention and percentage placed except that the majority of terrorism coverage is on an aggregate basis above our retentions without a reinstatement.

Effective September 1, 2023, Chubb purchased an additional layer of per occurrence coverage for named windstorms and earthquakes within Northeast states.

Coverage is provided for North American and international operations losses within the territory through August 31, 2024.

Loss Location Layer of Loss Comments Notes

13 unchanged sentences

All natural perils and terrorism (d)

United States

(Northeast States Only) $3.5 billion –

$4.0 billion Named windstorm and earthquake (e)

International

12 unchanged sentences

(d) These coverages are both part of the same Third layer within the Global Property Catastrophe Reinsurance Program and are fully placed with Reinsurers.

(e) Northeast states are defined as Virginia to Maine.

This coverage is fully placed with Reinsurers.

Capital Resources

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

June 30 December 31

September 30 December 31

(in millions of U.S.

4 unchanged sentences

Trust preferred securities 308 308

Total shareholders’ equity 52,875 50,519

Total Chubb shareholders’ equity 52,373 50,519

Total capitalization $ 67,117 $ 65,704

3 unchanged sentences

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 six months ended June 30, 2023, we repurchased $1.2 billion of Common Shares in a series of open market transactions under the Board of Directors (Board) share repurchase authorization.

At June 30, 2023, there were 20,760,232 Common Shares in treasury with a weighted-average cost of $152.91 per share.

In June 2023, the Board authorized the repurchase of up to $5.0 billion of Chubb's Common Shares effective July 1, 2023 with no expiration date.

At July 27, 2023, $5.0 billion in share repurchase authorization remained.

For the nine months ended September 30, 2023, we repurchased $1.8 billion of Common Shares in a series of open market transactions under the Board of Directors (Board) share repurchase authorizations.

At September 30, 2023, there were 23,467,247 Common Shares in treasury with a weighted-average cost of $159.69 per share, and $4.4 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.

12 unchanged sentences

June 16, 2023 July 7, 2023 $0.86 (CHF 0.77)

September 15, 2023 October 6, 2023 $0.86 (CHF 0.75)

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.

2 unchanged sentences

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 June 30, 2023, our usage under these facilities was $1.4 billion in letters of credit.

At September 30, 2023, our usage under these facilities was $1.0 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 June 30, 2023.

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

2 unchanged sentences

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 six months ended June 30, 2023, we were able to meet all our obligations, including the payments of dividends on our Common Shares, with our net cash flows.

During the nine months ended September 30, 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 $925 million and $5.8 billion from its Bermuda subsidiaries during the six months ended June 30, 2023 and 2022, respectively.

Chubb Limited received dividends of $1.4 billion and $6.8 billion from its Bermuda subsidiaries during the nine months ended September 30, 2023 and 2022, respectively.

Chubb Limited received cash dividends of $28 million and $32 million and non-cash dividends of $291 million and $348 million from Swiss subsidiaries during the nine months ended September 30, 2023 and 2022, respectively.

insurance subsidiaries of Chubb INA Holdings Inc.

2 unchanged sentences

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 six months ended June 30, 2023 and 2022.

Chubb Limited received no dividends from Chubb INA during the nine months ended September 30, 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 $458 million and $1.8 billion from its subsidiaries during the six months ended June 30, 2023 and 2022, respectively.

Subsequently, in July 2023, Chubb INA received $518 million from its subsidiaries.

Chubb INA received $976 million and $1.8 billion from its subsidiaries during the nine months ended September 30, 2023 and 2022, respectively.

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 six months ended June 30, 2023 and 2022.

Operating cash flows were $4.8 billion in the six months ended June 30, 2023, compared to $5.2 billion in the prior year period, primarily due to higher net losses paid and higher income taxes paid, partially offset by higher net premiums collected.

Cash from (used for) investing was $(2.3) billion in the six months ended June 30, 2023, compared to $1.1 billion in the prior year period, a decrease of $3.3 billion.

The following is a discussion of our cash flows for the nine months ended September 30, 2023 and 2022.

Operating cash flows were $9.4 billion in the nine months ended September 30, 2023, compared to $8.6 billion in the prior year period, primarily due to higher net investment income and net premiums collected, partially offset by higher net losses paid and income taxes paid.

Cash used for investing was $5.4 billion in the nine months ended September 30, 2023, compared to $5.2 billion in the prior year period, an increase of $0.2 billion.

Cash used for investing in the current period primarily included higher net purchases of fixed maturities and equity securities of $6.6 billion.

Cash used for financing was $2.3 billion in the six months ended June 30, 2023, compared to $0.7 billion in the prior year period.

The increase of $1.6 billion is from net repayments of $1.9 billion from repurchase agreements and $475 million from long-term debt, partially offset by fewer common shares repurchased of $860 million.

We use repurchase agreements as a low-cost alternative.

At June 30, 2023, there were $1.5 billion in repurchase agreements outstanding with various maturities over the next eleven months.

This increase was partially offset by a decrease in cash used for the acquisition of subsidiaries of $5.3 billion and a decrease in private equity contributions, net of distributions of $1.2 billion.

Cash used for financing was $3.3 billion in the nine months ended September 30, 2023, compared to $2.7 billion in the prior year period.

The increase of $0.6 billion used for financing included net repayments of $1.1 billion from repurchase agreements and $475 million from long-term debt, partially offset by lower common shares repurchased of $935 million.

We use repurchase agreements as a low-cost funding alternative.

At September 30, 2023, there were $2.6 billion in repurchase agreements outstanding with various maturities over the next eight 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.

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.

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.

Information provided in connection with outstanding debt of subsidiaries

6 unchanged sentences

(Subsidiary Issuer)

June 30 December 31 June 30 December 31

September 30 December 31 September 30 December 31

(in millions of U.S.

19 unchanged sentences

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:

Six Months Ended June 30, 2023 Chubb Limited

Nine Months Ended September 30, 2023 Chubb Limited

(Parent Guarantor) Chubb INA Holdings Inc.

8 unchanged sentences

Income tax expense (benefit) 10 (181)

Net income (loss) $ (6) $ (255)

Comprehensive income (loss) $ (6) $ (383)

Net loss $ (69) $ (404)

Comprehensive loss $ (69) $ (535)

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